Maruti, Hyundai expect sales of CNG vehicles to pick up

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The country’s top two carmakers and Hyundai Motor India are gearing up for a big push in sales of CNG-powered vehicles, especially at the entry level, amid spiralling costs of petrol and diesel.

Maruti Suzuki plans to produce 250,000 CNG vehicles this fiscal, an increase of nearly 60% over FY21, while Hyundai expects sales of its CNG models to treble to around 35,000 units this calendar year.

“We have seen an exponential increase in demand for CNG vehicles, first of all because of the rise in price of petrol and diesel fuel,” said

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Srivastava, executive director (marketing and sales) at Maruti Suzuki. “Secondly, the availability of CNG itself has improved, both geographically as well as in absolute numbers, making it emerge as a viable option for consumers,” he told ET.

Maruti Suzuki has eight CNG-powered vehicles – Alto, S-Presso, Celerio, WagonR, Ertiga, Eeco, and Dzire – in its portfolio. It plans to make CNG option available on all small cars in future.

Its closest rival Hyundai, too, expects a spike in CNG vehicle sales. The Korean carmaker currently has CNG options available on three models – Aura, Santro and Nios. “If we see demand for CNG in other products, we will not hesitate to bring it to the market”, said Tarun Garg, director (marketing and sales) at Hyundai Motor India (HMIL).

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He expects sales of CNG vehicles in the company to increase to around 35,000 units in CY2021, up from annual average sales of 8,000-10,000 units recorded the past couple of years. Hyundai will focus on petrol and CNG in the small car segment, and play on petrol and diesel for its SUVs, Garg said.

Running cost of CNG vehicles is less than half of petrol/diesel vehicles, automakers said. In Delhi, for example, running costs of a CNG vehicle is Rs 1.60-1.70 per km against Rs 4-4.10 of petrol/diesel vehicles.

Petrol and diesel prices in the country are at an all-time high, with petrol crossing the Rs 100 mark in several states and UTs. Petrol, diesel and CNG prices stood at Rs 97.76 per litre, Rs 88.30 per litre and Rs 43.40 per kg, respectively, in the national capital on Thursday.

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Further, the premium paid on a CNG vehicle vis a vis its petrol model at Rs 75,000-80,000 is lower compared to Rs 1,25,000-1,50,000 premium on diesel models, automakers said.

CNG availability has also improved. As many as 3,400 CNG distribution outlets are operational across 350 cities in the country, up from 1,400 outlets across 142 cities 3-4 years back. In 2019, the petroleum and natural gas ministry had announced plans to set up 10,000 CNG distribution outlets in 10 years to push adoption of CNG vehicles in the personal mobility space.

It is estimated that the country will save nearly Rs 2 lakh crore in oil imports if personal car users switched to CNG vehicles.

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Overall, increasing fuel price differential, improving availability of CNG filling stations, and more product options will continue to drive CNG adoption.

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