With fuel prices heading northward, demand for compressed natural gas(CNG) and liquified petroleum gas(LPG) vechicles is all set to grow in the long term. Some of the immediate effects are seen with queries for CNG and LPG variants rising at dealerships, while CNG kit fitters expect a surge in business.
Delhi-based CNG and LPG kit fitter Delhi Auto Spares said that it sells around 200 CNG kits every month and that net size of the CNG kit fitting market in Delhi is around 4000-4500 kits per month. "The government has raised CNG prices by around Rs 5-6 sometime back to around Rs 27.5 per kg in Delhi. Had this price rise not come in, we estimate the demand for CNG kits would have almost doubled in Delhi market with the recent petrol price rise. Even now, we are getting lots of new queries everyday", said Mukesh Garg of Delhi Auto Spares.
After factoring in the recent price rise of CNG, it is still around 56 per cent cheaper than petrol and around 27 per cent cheaper than diesel in Delhi region. The Centre decontrolled petrol prices on June 25 resulting in a Rs 3.5 per litre increase in rates in Delhi and raised diesel prices by Rs 2 a litre and has suggested a potential decontrol of diesel prices in the recent future.
Ahmedabad based Manan Autolink,which is again a major market for CNG powered vehicles, said that almost 40 per cent of its customers get a CNG kit fitted from outside as they come cheaper."We sell around 400 cars per month in Ahmedabad region of which around 150 cars would get fitted with CNG kits. The highest selling car here is the Wagon R, which accounts for nearly 40 per cent of the sales followed by the Alto at 28 per cent", informed Anil Patel, chief managing director of Manan Autolink Ltd,one of the leading dealers of Maruti Suzuki vehicles in the region.
Shashin Shah of Yogi Auto Care, a leading Hyundai dealership in the city confirmed the same saying "Market fitted CNG kits are on an average cheaper by around Rs 20,000 compared to factory fitted ones, so most buyers prefer to go for kits sold in the open market. Around 10-20 per cent of our sales currently come from CNG variats of the Accent and Santro."
As a fallout of this renewed demand for greener fuel vehicles, queries have proportionately increased for individual CNG kit fitters in the city. Raj Motors, a city based fitter, said that they have handled around 25-30 queries per day this week compared to 10-12 a week earlier, after the Centre's announcement last Friday.
While the short term impact of the government's move is a demand boost for the CNG kit fitters, auto-makers say that the long term move is definitely towards CNG and LPG variants of cars.
Leading passenger car maker Maruti Suzuki is all set to come up with CNG compatible variants of its leading models across segments soon. It plans to introduce CNG variant of its recently upgraded Wagon R hatchback within the next three months, which could be about Rs70,000 costlier than the existing version. Maruti has an LPG variant of the Wagon R. "The movement is undoubtedly towards CNG and LPG powered vehicles in the times to come. Initially customers would be apprehensive as the cylinder would eat up boot space, but with rising petrol and diesel prices, the shift has to be towards these greener vehicles along with more fuel efficient vehicles. With our new K-series engine we are now able to offer around 10-15 per cent higher mileage compared to conventional engines", said Partho Banerjee, general manager, marketing strategy & development of Maruti Suzuki India Ltd. Popular models like Alto, Eeco, Estilo and SX4 are likely to be powered by CNG fuel.
