The automated guided vehicle (AGV) market is expected to nearly double its size by 2024, reaching $1.5 billion in sales as material handling companies worldwide increasingly turn to automation to boost efficiency and cut labor costs, an industry study says.

Estimates from San Francisco-based market research firm Grand View Research Inc., which issued the report, put the global AGV market's current size at $810.4 million as of the end of 2015.

The growth will be the result of public and private warehouse operators boosting their spending on robotics and manufacturing technology to meet growing demand while keeping a cap on rising labor costs, the report said. Users who replace their conventional conveyor systems with AGVs also cite advantages such as reduced operational costs, decreased production times, and enhanced workforce safety, according to the report.

Despite the benefits, high initial installation costs have proved to be a roadblock, especially for small to mid-size buyers. The key to overcoming that hurdle is to deploy wireless navigation technologies that eliminate the need for expensive retrofitting, the study concluded.

Many current AGV systems require special reflectors or markers to guide the vehicles along their routes. However, advanced laser and vision-based technology now allows vehicles to navigate crowded warehouses without relying on that infrastructure. The so-called "natural navigation" sector represented just $18.4 million of revenue in 2015. However, it is expected that more businesses will embrace the equipment because it does away with costly infrastructure adds and upgrades.

The Asia-Pacific region is expected to show the fastest growth, with sales expanding at a near 8-percent-compound annual clip through 2024, according to an analysis of the report's data projections.

Increasing demand for AGVs and associated technologies would benefit a wide range of firms, the report said. Among them: Swisslog Holding AG, Egemin Automation Inc., Bastian Solutions Inc., Daifuku Co. Ltd., Dematic Corp., JBT Corp., Seegrid Corp., Toyota Industries Corp., Hyster-Yale Materials Handling Inc., Balyo Inc., EK Automation GmbH, Kollmorgen Corp., and KMH Systems Inc.