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Warehouse operations are becoming increasingly automated, but automation does not automatically mean that every traditional piece of material handling equipment needs to disappear.

For decades, pallet trucks have been one of the simplest and most practical ways to move palletised goods between loading bays, storage areas, production lines and dispatch zones. Today, automated guided vehicles, commonly known as AGVs, can perform many of the same transport tasks without a driver.

This creates an important question for warehouse managers: should you continue using pallet trucks, invest in AGVs, or use both?

The answer depends on your warehouse size, pallet volume, layout, operating hours, budget and how predictable your material flow is.

For many modern warehouses, pallet trucks remain extremely useful because they provide flexibility and comparatively simple deployment. AGVs become more attractive when pallet movements are repetitive, predictable and frequent enough to justify automation.

Understanding how the two systems differ can help you choose a solution that improves productivity without adding unnecessary cost or complexity.

What Is a Pallet Truck?

A pallet truck is a compact piece of material handling equipment designed primarily to move palletised goods horizontally.

The forks slide beneath a pallet, raise it slightly from the floor and allow it to be transported to another location.

There are two common categories.

Manual pallet jacks rely on an operator to pull or push the load.

Powered pallet trucks use an electric motor to move the equipment, which reduces physical effort and makes them better suited to frequent or longer-distance pallet movements.

Ban Ngai Rent's pallet truck range includes lithium-ion and lead-acid powered models with approximately 2.0 to 3.0 tonnes of capacity, making them suitable for warehouses, logistics hubs, factories, retail distribution facilities and other pallet-handling environments.

Powered pallet trucks are particularly useful where loads need to move quickly at ground level but do not require high stacking.

What Is an AGV?

An Automated Guided Vehicle is a driverless material handling vehicle designed to transport materials through a warehouse or industrial facility.

Instead of relying on a human operator to steer the machine, an AGV follows a programmed route using technologies such as sensors, markers, magnetic strips, QR codes, cameras or laser-based navigation.

Depending on the system, AGVs can move:

• Pallets
• Containers
• Components
• Raw materials
• Finished products
• Manufacturing supplies

More advanced warehouse systems may integrate AGVs with warehouse management software, conveyors, automated storage systems and inventory-management platforms.

Malaysia is already seeing practical deployments of this technology. In June 2026, CelcomDigi demonstrated 5G-powered AGVs as part of an advanced intelligent warehouse in Shah Alam, alongside autonomous pallet storage, AI monitoring and other automated systems.

Pallet Truck vs AGV: The Main Difference

The biggest difference is control.

A pallet truck normally requires a worker to operate it. An AGV can transport goods automatically along predetermined workflows.

However, this difference affects much more than labour.

It changes the cost structure, flexibility, infrastructure requirements, maintenance needs and operating model of the warehouse.

Neither option is automatically better. Each works best in a different operating environment.

When Does a Pallet Truck Make More Sense?

A powered pallet truck is often the more practical option when warehouse tasks change frequently.

An operator can move from one aisle to another, collect an unexpected pallet, reposition stock or respond to a loading delay without reprogramming a system.

That flexibility becomes especially valuable in warehouses where daily activities are not completely predictable.

Smaller and Medium-Sized Warehouses

Smaller facilities may not handle enough pallet movements to justify the cost of a sophisticated automation system.

A powered pallet truck provides mechanical assistance without requiring major changes to the warehouse infrastructure.

Changing Warehouse Layouts

Some warehouses regularly change storage zones, racking positions or production layouts.

Human-operated equipment can adapt almost immediately.

An automated system may require mapping, configuration or integration changes before the same workflow can continue.

Seasonal Operations

Retail, e-commerce and distribution businesses often experience temporary increases in warehouse volume.

Renting additional pallet trucks during peak periods can provide more handling capacity without requiring a permanent investment in automation.

Mixed Tasks

A warehouse worker might move a pallet from receiving to storage, collect another pallet from a staging area and then support dispatch operations.

A powered pallet truck can move between these tasks easily.

AGVs perform best when their movements are more structured.

When Does an AGV Make More Sense?

AGVs become more attractive when warehouses repeat the same material movement hundreds or thousands of times.

For example, consider a manufacturing facility where pallets continuously move between a production line and a finished-goods storage area.

The route may rarely change.

Automating that movement allows the same process to continue with less direct operator involvement.

High-Volume Repetitive Transport

AGVs perform particularly well when the origin, destination and path are predictable.

Typical examples include:

Receiving area → Storage zone

Production line → Warehouse

Warehouse → Packing area

Packing area → Dispatch zone

The more repetitive the movement becomes, the stronger the business case for automation may become.

Multi-Shift Operations

Warehouses operating two or three shifts may be able to use automated equipment for longer periods.

Higher utilisation can make the initial investment easier to justify.

Smart Warehouse Environments

AGVs become more useful when connected with warehouse management systems and automated storage technologies.

Warehouse automation is accelerating across ASEAN, with Malaysia emerging as a significant growth market as logistics, manufacturing, retail and e-commerce businesses invest in more technology-enabled facilities.

Cost: Pallet Trucks Have a Major Advantage

Initial cost is one of the biggest differences between pallet trucks and AGVs.

A powered pallet truck is a relatively straightforward machine.

AGV implementation can involve:

• Vehicles
• Navigation infrastructure
• Software
• Sensors
• Charging systems
• Network connectivity
• Warehouse-management integration
• Safety systems
• Mapping
• Installation
• Testing
• Staff training

The AGV itself is therefore only one component of the overall investment.

This does not mean AGVs are too expensive.

In high-volume operations, automation can produce significant long-term operational benefits.

However, the investment should be evaluated against actual pallet movement volume rather than adopted simply because automation is becoming more popular.

Flexibility: Pallet Trucks Have the Edge

Warehouses rarely operate exactly as planned every day.

A truck may arrive late. A pallet may be stored in the wrong location. A picking area may become congested. A temporary staging area may be created during peak demand.

Human-operated pallet trucks can respond immediately.

An operator can simply choose another route.

AGVs are becoming increasingly sophisticated, but they still perform best when warehouse processes have been carefully structured.

If your warehouse environment changes frequently, flexibility may be more valuable than full automation.

Labour: AGVs Reduce Repetitive Driving

Repeated pallet transportation can consume significant employee time.

If workers spend several hours per shift simply moving pallets between two fixed points, that process may be suitable for automation.

AGVs can take over some repetitive transportation, allowing employees to concentrate on tasks requiring decision-making, inspection, picking, packing or exception handling.

However, AGVs do not eliminate the need for warehouse staff.

People are still required for:

• System supervision
• Maintenance
• Loading and unloading
• Exception handling
• Inventory management
• Safety oversight
• Equipment servicing
• Process improvement

Automation changes the type of work performed rather than simply removing every human role.

What About Reach Trucks?

AGVs and pallet trucks generally focus on transportation.

High-rack storage creates a different requirement.

When pallets need to be placed several metres above the floor inside narrow warehouse aisles, a reach truck is usually more appropriate.

Ban Ngai Rent's reach truck range includes models with lifting heights from approximately 6 to 13.5 metres and capacities around 1.5 to 2.0 tonnes.

This is why most warehouses need multiple equipment types.

A pallet truck can transport stock horizontally.

A reach truck can place pallets into elevated racking.

An AGV can automate predictable transport routes.

These machines solve different parts of the material-handling process.

What About Forklifts?

Forklifts remain important where heavier loads, truck loading and unloading, outdoor movement or more versatile lifting are required.

Ban Ngai Rent provides forklifts across electric, diesel and LPG configurations, allowing equipment to be matched with indoor warehouse environments as well as heavier outdoor applications.

Even highly automated warehouses may continue using forklifts for tasks that are too variable to justify automation.

This is one reason modern material handling should be viewed as an equipment ecosystem rather than a competition between one machine and another.

Safety Considerations

Both pallet trucks and AGVs require careful safety planning.

Powered pallet trucks operate close to pedestrians and other warehouse vehicles, so clearly defined traffic routes, operator awareness and appropriate speed management remain important.

AGVs remove some risks associated with operator driving behaviour, but they introduce different requirements.

Warehouses must consider:

• Pedestrian detection
• Vehicle sensors
• Emergency stops
• Safe intersections
• Charging areas
• Network reliability
• Software failures
• Manual override procedures

Automation should support warehouse safety rather than be treated as a replacement for safety management.

Space Requirements

Warehouse design can also influence the decision.

Powered pallet trucks are compact and can operate in relatively tight areas.

AGVs require predictable travel paths and enough clearance to navigate safely. Depending on the navigation technology, routes may also need to remain free from unexpected obstacles.

Warehouses designed from the beginning for automation have more freedom to optimise these routes.

Older facilities may require layout modifications before large-scale AGV deployment becomes practical.

Battery and Charging Requirements

Both powered pallet trucks and AGVs typically rely on batteries.

The charging strategy should therefore be considered before equipment is deployed.

Questions include:

• How many hours will the equipment operate each day?
• Are multiple shifts required?
• Where will charging occur?
• Can equipment charge during breaks?
• How much downtime is acceptable?
• Is charging infrastructure already available?

Ban Ngai Rent's powered pallet truck range includes both lithium-ion and lead-acid configurations.

Lithium-ion equipment can be particularly useful where frequent charging opportunities are available during warehouse operations.

Should You Replace Pallet Trucks With AGVs?

Not necessarily.

For many warehouses, a hybrid approach makes more sense.

AGVs can handle predictable, repetitive transport routes while pallet trucks remain available for flexible or unexpected movements.

For example, AGVs might continuously move finished pallets from production to storage.

Workers could use powered pallet trucks for:

• Urgent movements
• Damaged stock
• Temporary staging
• Loading support
• Inventory reorganisation
• Unexpected workflows

This allows automation to handle repetitive tasks without removing operational flexibility.

Pallet Truck vs Pallet Jack vs Pallet Stacker

These terms are sometimes used interchangeably, but they do not always refer to the same equipment.

Pallet Jack

A pallet jack generally lifts a pallet only enough to move it horizontally.

Manual pallet jacks rely entirely on human effort for movement.

Powered Pallet Truck

A powered pallet truck uses an electric drive system, making it better suited to frequent pallet movement and longer warehouse distances.

Pallet Stacker

A pallet stacker can lift goods higher than a standard pallet truck and may be suitable for lower-level stacking.

However, a stacker generally does not provide the same high-racking capability as a dedicated reach truck.

Renting Equipment Can Help During Warehouse Transition

A warehouse moving toward automation does not necessarily complete the transition in one project.

Automation is often introduced in stages.

Businesses may automate one repetitive route while continuing to use conventional equipment throughout the rest of the warehouse.

During this transition, rental can provide flexibility because the business does not need to purchase every additional machine permanently.

The broader rental benefits can be particularly relevant when equipment requirements change because of seasonal demand, temporary contracts, expansion or warehouse redesign.

Questions to Ask Before Choosing

Before selecting pallet trucks, AGVs or a combination of both, warehouse managers should evaluate the following questions.

How many pallets move through the warehouse each day?

How repetitive are those movements?

How often does the warehouse layout change?

How many shifts operate each day?

What are the labour requirements?

How much capital is available?

Are the routes predictable?

Does the warehouse already use a WMS?

How much integration would an automated system require?

Does the facility need flexibility more than repetition?

What happens when the normal workflow changes?

The answers reveal whether automation is solving a real operational problem or simply adding technology.

Frequently Asked Questions

Is an AGV better than a pallet truck?

Not in every warehouse. AGVs are better suited to predictable, repetitive transportation, while powered pallet trucks provide greater flexibility when routes and tasks change frequently.

Can AGVs completely replace pallet trucks?

They can replace some repetitive transport tasks, but many warehouses continue to use pallet trucks for irregular movements, temporary workflows and situations requiring human judgement.

What is a powered pallet truck used for?

Powered pallet trucks move palletised goods horizontally across warehouses, loading areas, factories and distribution centres.

Are pallet trucks suitable for large warehouses?

Yes. Powered pallet trucks are commonly used in large warehouses, particularly for ground-level movement between receiving, storage, picking and dispatch areas.

Are AGVs suitable for small warehouses?

They can be, but the investment is easier to justify when there is sufficient repetitive material movement. Smaller warehouses with frequently changing tasks may benefit more from flexible conventional equipment.

Do AGVs replace forklifts?

Not necessarily. Forklifts may still be required for loading trucks, outdoor work, heavier loads or tasks that change frequently.

What equipment is best for high warehouse racks?

Reach trucks are generally better suited to narrow aisles and elevated warehouse racking because they are specifically designed for high-level pallet placement and retrieval.

Final Thoughts

The choice between pallet trucks and AGVs is not simply a choice between traditional equipment and new technology.

It is a question of matching equipment with the workflow.

Powered pallet trucks provide flexibility, straightforward deployment and relatively low complexity. They remain highly practical for warehouses where pallet movements change throughout the day.

AGVs provide greater automation when goods move repeatedly between predictable points and the volume is high enough to support the investment.

For many modern warehouses, the strongest solution will be a combination of technologies. AGVs can automate repetitive transport, powered pallet trucks can handle flexible pallet movement, reach trucks can manage high racking, and forklifts can support heavier or more variable tasks.

The modern warehouse does not need every process to be automated. It needs the right level of automation for each process.