June 20, 2024
CNG And LPG Vehicles Market

The Rise of CNG And LPG Vehicles Market in Rising Fuel Costs Trend

The CNG and LPG vehicle market consists of light, medium, and heavy-duty vehicles that run on compressed natural gas (CNG) and liquefied petroleum gas (LPG). CNG provides cleaner emissions and is a cost-effective alternative to gasoline and diesel. Increasing global fuel prices have driven demand for alternative fuel vehicles.

The Global CNG And LPG Vehicle Market is estimated to be valued at US$ 5.33 Bn in 2024 and is expected to exhibit a CAGR of 12% over the forecast period 2024 To 2031.

Key players operating in the CNG and LPG vehicle market include HYUNDAI MOTOR GROUP, Fiat Chrysler Automobiles, Honda Motor Co. Ltd., Suzuki Motor Corporation, General Motors, Groupe Renault, Tata Sons Private Limited, Landi Renzo S.p.a., Volkswagen AG, AC S.A., Nissan, Navistar Inc., Ford Motor Company, KION GROUP AG, and AB Volvo. Stringent emission standards and policies encouraging eco-friendly vehicles have benefited these players.

The growing for economical and low-emission transport solutions has driven the adoption of CNG And LPG Vehicles Market Demand globally. The affordable fuel costs and growing vehicular pollution levels have prompted consumers to switch from conventional fuels to CNG and LPG. Various government incentives and subsidies for eco-friendly vehicles have further boosted their sales.

The global CNG and LPG vehicle market is expanding rapidly with growing demand across countries. Market players are focusing on strategic collaborations and expansions to emerging markets in Asia Pacific, Middle East, and Latin America. Domestic manufacturers in India and China are contributing to the large market size. The rising emphasis on reducing carbon footprint will continue driving international growth opportunities over the forecast period.

One of the key trends in the CNG and LPG vehicle market is the development of multi-fuel vehicles that can run on more than one type of fuel. Automakers are introducing dual-fuel or bi-fuel vehicles that switch between gasoline/CNG or gasoline/LPG depending on fuel availability. This provides greater flexibility to users and drive adoption in regions with inadequate CNG fueling infrastructure. The flexibility of multi-fuel vehicles is expected to further bolster demand.

Porter’s Analysis

Threat of new entrants: The CNG And LPG Vehicle Market requires high upfront investments, thereby acting as a high barrier to entry for new players.

Bargaining power of buyers: Buyers have moderate bargaining power due to the availability of several options in the market.

Bargaining power of suppliers: A few big automakers dominate the supply market, giving them higher bargaining power over raw material prices and supplies.

Threat of new substitutes: Electric vehicles are emerging as a substitute but high costs are limiting their mass adoption currently.

Competitive rivalry: The market has the presence of several big automakers leading to high competitive pressure on pricing and innovation.

Geographical Regions

In terms of value, Asia Pacific dominated the global CNG And LPG Vehicle Market in 2024, accounting for around 40% share. Growing demand for clean transportation in countries such as India and Indonesia is driving the regional market.

The CNG And LPG Vehicle Market in Middle East and Africa is anticipated to grow at the fastest pace during the forecast period, with an expected CAGR of over 15%. Increasing preference for natural gas vehicles due to low operations costs is fueling market growth in the region.

1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it