Greener fleets: The impact of electrification in the rental market 

As an increasing number of enterprises pivot toward sustainable operations, rental channels are uniquely positioned to capitalize on the shift to electric machinery.

by Rod Dayrit

Electrified fleets offer an attractive option for both sides of the rental scene. Despite higher capital acquisition costs compared to internal combustion engine (ICE) machines, expenses quickly sway the other way due to minimal maintenance requirements when batteries are recharged and cared for properly.

Even so, the adoption of electric drivetrains varies greatly. In 2022, for example, 89 percent of scissor lifts were all-electric, whereas only 25 percent of boom lifts made the switch.

Understanding the context behind figures like these and identifying the key drivers of electrification in off-road machinery is crucial for rental fleet managers and OEMs in the industrial sector. This article aims to delve into the latest data, offering insights for those seeking to optimize the benefits of electrification.

Sustainability driving change in fleet management
Along with the greater industry, rental channels are increasingly moving toward environmental, social, and governance (ESG) initiatives.

This shift is particularly synergistic with electrification, which supports all three pillars of ESG:

  • Environmental – Electrified machinery reduces carbon emissions and reliance on fossil fuels, supporting broader environmental goals.
  • Social – Switching from ICE to electric fosters new collaborations with suppliers and enhances engagement with environmentally conscious customers.
  • Governance – As an increasing number of shareholders advocate for decarbonization, adopting electrified machinery provides a tangible response to these demands.

As ESG gains traction among a wider consumer base, rental fleets that already have electric offerings will stand to benefit. In this regard, Mobile Elevating Work Platforms (MEWPs) are leading the charge in the non-road sector, with machinery such as scissor lifts achieving high rates of electrification.

Implications and benefits of sustainable fleets
MEWP’s significant degree of electrification makes sense from two perspectives: operational benefits and long-term strategy.

To the first point, it’s clear that zero emissions translate to increased flexibility in regional deployment, particularly in stringent regulatory environments, and job sites where employing diesel equipment would be impractical or impossible. This could range from indoor warehouses to urban centers with noise and emission restrictions, effectively opening the door to new rental opportunities in these and other applications.

As for long-term strategy, electric drivetrain superiority is well established. Yet its many benefits are accentuated by the very nature of rental fleets. Consider a few examples:

  • Higher initial costs – The upfront cost of electrified vehicles often deters operators from investing themselves, preferring to outsource rental vehicles. This heightened demand enables renters who invest in electric offerings to achieve an even quicker return on investment (ROI).
  • Reduced total cost of ownership (TCO) – Electric fleets smooth out their pricier acquisition cost with reduced lifetime expenses by eliminating fluid changes, replacement of worn/damaged parts, increasing fuel cost and the need for trained mechanics to perform qualified power-train service.
  • Improved reliability – Besides requiring less maintenance, electric machines also benefit from predictive maintenance. This translates to reduced downtime and unpredictable disruptions impacting duty cycles—the value of which cannot be measured in dollars.

Rental equipment thus enables end users to tap into the many advantages of electrified machinery without burdening themselves with the ongoing cost of ownership. Not only does this increased accessibility drive additional rental demand, but it also provides access to the newest technologies.

The role of compliance
Electrification is also one of the few means to ensure regulatory compliance in the global mission to achieve a Net Zero Emissions scenario, neutralizing the effects of carbonization by 2050. MEWPs and similar light-duty vehicles play a part, projected to achieve an ambitious 100 percent electrification adoption rate within the next decade.

California’s Environmental Protection Agency (EPA), a U.S. state regulatory entity that implements and enforces laws followed by many outside industrial regulators, continues to raise the bar of minimum emission standards. Recent rules target heavy-duty industrial vehicles, aiming to reduce emissions among this class of vehicles by 50 percent in 2027. While even the largest MEWPs and telehandlers do not fall under this category, it nonetheless sends a clear message about the overall industry trajectory.

The California Air Resources Board (CARB) proposes even stricter regulations for cargo handling equipment, such as telehandlers and cargo lifts. If these amendments are approved, all such equipment must achieve  100 percent emission reductions, effectively ensuring a complete transition to electric operations in this sector.

Even as the rental channel continues to prioritize sustainability and compliance, the stringent regulations placed on electrified solutions will undoubtedly continue to grow, pushing OEMs to innovate and adapt to meet these evolving needs.

Emergence and effects of electric vehicle (EV) charging networks
In 2023, EVs made up 18 percent of all cars sold, up from a mere 2 prtvrny in 2018. Sustaining this explosive growth is an equally impressive increase in charging infrastructure. As of 2024, the US alone is home to over 168,300 EV charging stations.

For savvy rental fleet managers, this infrastructure represents an untapped opportunity.

The emergence and penetration of EV charging stations allow previously unattainable levels of power delivery, surpassing traditional grid limits of 1200 to 1500W. The U.S. Department of Energy estimates there will be approximately 1.2 million DC fast charging “ports” (the equivalent of a single gas pump in a gas station) available by 2030.

Fleets that integrate electric vehicle supply equipment (EVSE) chargers into MEWPs and mobile machinery can leverage this easily accessible infrastructure, enabling new avenues of operational versatility such as:

  • Opportunity charging – Rather than returning vehicles to the warehouse for charging, existing charging stations can provide short, opportunistic bursts of charging between shifts, extending overall vehicle runtime.  
  • Expanded range – Fleet managers can deploy equipment to more remote locations with the assurance of locally available charging infrastructure, reducing dependency on specific work sites and eliminating the need to construct dedicated charging areas.
  • Fast-charging compatibility – The advent of fast charging stations (along with a compatible charger) enables DC fast charging, allowing operators to top up electrified machinery in mere minutes instead of hours.
  • Standardization of hardware—Makers of EVSE charging stations have resisted using their own proprietary connectors. Globally standardizing the hardware design opens more access points for EV charging.

These capabilities improve equipment performance while aligning with the broader push toward electrification. OEMs that incorporate these features and the rental channels that make use of them will be well-positioned to maximize fleet efficiency and sustainability.

Increasing property prices: reshaping electric rental trends
The cost of industrial warehouse and distribution spaces hit a record high in 2023, spiking almost 21 percent year over year. These soaring prices have sparked a migration toward more space-efficient solutions, especially since bulky charging stations occupy valuable real estate.

Onboard chargers have since emerged as a strong alternative, enabling key benefits such as:

  • Simplified charging – In addition to saving valuable space, an integrated onboard charger also streamlines the charging process for end users, even allowing the vehicle to plug into standard electrical outlets. This simplicity makes EVSE-enabled machinery ideal for rental operations.
  • Reduced overhead – By eliminating the need to purchase, set up and calibrate an extensive in-house charging infrastructure, onboard chargers enable more flexible charging options, from on-site generators to public charging stations.
  • Lower TCO – Advanced onboard chargers enable fleet owners to maximize their charging efficiency, ensuring no energy is lost and thus reducing costs over time. Notably, studies show an optimized charging schedule can reduce charging costs by up to 46.3 percent.

As competition increases and adequate space grows scarce, the benefits of an onboard charging solution multiply. This innovation makes electrified machinery an attractive option for rental companies looking to optimize operations and cut down on unnecessary expenses.

Li-ion market dynamics
Another strong electrification driver in non-road machinery lies at the heart of electric drivetrains: batteries. The cost of Li-ion batteries dropped an unprecedented 8 percent — from $780 per kWh to $139 — between 2013 and 2023.

This market shift has gradually dethroned lead-acid batteries and catapulted the cost-performance value of Li-ion into the realm of viability, enabling electrified fleets to see a significantly faster ROI.

In addition, Li-ion offers a significant edge in power density. Traditional lead-acid batteries simply lack the strength needed to power heavy-duty machinery, such as boom lifts. This explains why electrification seems to lag in these sectors, as noted at the outset.

How Li-Ion innovations drive progress
Further compounding its many advantages, Li-ion batteries enable the integration of intelligent battery management systems (BMS) into the machinery itself. This paves the way for advanced features such as:

  • Real-time monitoring of battery health, charge status and performance metrics
  • Improved safety functions that protect against overcharging or overheating
  • Optimized, balanced fast-charging that preserves battery lifespan
  • Predictive maintenance alerts to reduce unplanned downtime
  • Dynamic load management that adjusts power output based on demand

The combination of reduced prices and greatly expanded performance translates to a massive boost in productivity and reduced maintenance costs for fleet owners. Given Li-ion’s many advantages over lead-acid, it’s very likely only a matter of time before it achieves even greater dominance in the industrial sector.

The electric future of rental fleets
We’ve heard for years that electrification is coming. But the truth is that it’s already here and OEMs, fleet owners, and operators must adapt quickly to stay competitive.

Electric drivetrains are transforming the rental industry with benefits that extend beyond environmental sustainability. From reduced downtime and lower maintenance costs to alignment with ESG frameworks, electrification is no passing trend but a glimpse into the industry’s future.

By investing in advanced charging solutions, integrating intelligent battery management systems and capitalizing on the advantages of electrified machinery, rental fleets can achieve new heights of efficiency and profitability.

Editor’s note: Rod Dayrit is global business development director, ZAPI GROUP Charging Solutions.