This paper presents a comprehensive navigation strategy aimed at enabling autonomous and collision-free motion of automated guided vehicles (AGVs) in indoor environments. The work addresses limitations of conventional AGV systems which are often restricted by static routing and inadequate adaptability to dynamic obstacles. A framework on global–local motion planning is developed, optimising (i) a global path planner based on the Probabilistic Roadmap (PRM) algorithm, (ii) a local trajectory tracking using the Pure Pursuit (PP) controller, and (iii) a real-time obstacle avoidance method leveraging the vector field histogram (VFH) algorithm. The decision-making layer oversees the coordination between global routing and local manoeuvring, dynamically switching between planning and avoidance modes in response to environmental changes. The proposed framework is validated through real-world experiments on a physical AGV platform operating in a structured environment. Experimental results show that the proposed framework generates feasible and smooth paths, while PP-based trajectory tracking achieves high final positioning performance when supported by fused odometry. In free-path navigation, fused odometry reduced the average final percentage error to 0.61% and increased the average final positioning accuracy to 99.40%. In obstacle-path navigation, the integrated PP–VFH framework maintained high final positioning accuracy at 99.10% under varying obstacle configurations. The coordination of PRM, PP, and VFH enables smooth, adaptive, and safe navigation of the AGV within a structured workspace. The proposed framework contributes a unified, modular architecture that strategies to bridges global path planning, local motion control, and real-time reactive avoidance within a single system.