Carmakers put spotlight on CNG to drive green mobility

New Delhi: CNG (compressed natural gas) cars have recently gained traction in the Indian market, becoming a preferred fuel choice for buyers. CNG sales have grown exponentially year-over-year (Y-o-Y) from January to August 2024, with a 46% increase, according to Jato Dynamics. Other fuels, such as petrol, have seen a drop of 4.5%, while diesel grew by 5%.

Given the rising fuel costs of petrol and diesel, customers are increasingly looking for cost-effective mobility solutions. "CNG vehicles, with their lower operational costs and better fuel economy, have become an attractive option for budget-conscious buyers," said Vivek Srivatsa, Chief Commercial Officer of Tata Passenger Electric Mobility Ltd, in an interview with ETAuto.

The government has set Corporate Average Fuel Efficiency (CAFE) standards, an emission norm to limit the amount of carbon dioxide a car manufacturer can produce in a financial year. OEMs are required to make more fuel-efficient vehicles under these norms.

Auto majors are now focusing on eco-friendly fuel solutions to align with the government's initiative to reduce CO2 emissions from cars. The Bureau of Energy Efficiency (BEE) has proposed CAFE 3 norms, which will take effect in 2027. Auto companies have been given five years to meet CAFE 4 norms.

Leading auto players such as Maruti Suzuki, Tata Motors, and Hyundai have introduced multiple CNG car variants of their top-selling vehicles.

Fueling the sustainable solution for commuting

India’s largest automaker, Maruti Suzuki, aims to exceed 6 lakh CNG sales by the end of FY25. Currently, CNG contributes 34.4% of MSIL's overall sales. Tata Motors, another leading auto major, has rolled out a twin-cylinder system, which has fueled its CNG sales, giving it a market share of 21.1% in H1 FY2024. Hyundai Motor India has launched the Hy-CNG Duo (dual-cylinder system) in its Exter and Grand i10 NIOS models. The company's contribution of CNG models to HMIL's domestic sales has increased from 9.1% in FY22 to 11.4% in FY24.

Maruti Suzuki’s CNG portfolio is a strategic move aimed at catering to the diverse requirements of consumers and providing a sustainable mode of transportation. "By expanding our CNG variant lineup, we aim to offer a choice that aligns with the growing network of CNG stations, thereby facilitating a reduced cost of ownership for customers," said Partho Banerjee, Senior Executive, Marketing & Sales, Maruti Suzuki.

"We continuously listen to our customers' feedback and are cognizant of their aspirations. The introduction of the Hy-CNG Duo is aimed at meeting customer demands for ample space, high mileage, and safety," said Tarun Garg, Whole-time Director and Chief Operating Officer of HMIL.

Future outlook

Along with other auto majors, Maruti Suzuki has high hopes for CNG fuel and will continue to cater to the diverse needs of its customers. "This initiative is driven by our commitment to offering economical and environmentally friendly alternatives for our customers," added Banerjee.

Hyundai India will continue to diversify its CNG portfolio as it not only provides sustainability but also offers comfort to buyers. The top three markets for CNG sales in Hyundai from January to October 2024 are Pune, New Delhi, and Ahmedabad, according to Garg.

Tata Motors has redefined its CNG vehicle segment sales strategy by addressing key customer concerns and enhancing the ownership experience. The company plans to introduce CNG variants in its top-selling models due to strong customer demand and its commitment to providing fuel-efficient, environmentally friendly alternatives for a wide range of consumers.

The growth of CNG in the country is driven by its cost-effective usage for gig workers, small businesses, fleet purposes, and more.

The diverse fuel options (EVs, CNGs, hybrids, and more) provided by OEMs offer an opportunity for the country to shift toward cleaner and greener fuel alternatives.