Cng And Lpg Vehicle Market Report

Market Insights

“The CNG & LPG vehicle market size was US$ 12.7 billion in 2024 and is likely to grow at a CAGR of 6.9% in the long run to reach US$ 21.8 billion in 2032.”

Market Dynamics

Introduction

The CNG (Compressed Natural Gas) and LPG (Liquefied Petroleum Gas) vehicle market has seen significant growth in recent years, driven by environmental concerns, cost-effectiveness, and government initiatives promoting cleaner fuels. Both CNG and LPG are considered eco-friendly alternatives to traditional gasoline and diesel, offering lower emissions of harmful pollutants like carbon monoxide and nitrogen oxides. This shift is especially popular in urban areas with high levels of air pollution. Additionally, CNG and LPG vehicles typically have lower operating costs due to the cheaper price of fuel compared to conventional options. With increasing awareness and the development of refuelling infrastructure, the demand for CNG and LPG vehicles is expected to continue growing, contributing to cleaner air and reduced dependency on fossil fuels.

Recent Market JVs and Acquisitions:

In the CNG and LPG vehicle market, recent mergers & acquisitions, and joint ventures (JVs) reflect the industry's drive to enhance technology, expand production capabilities, and meet the growing demand for eco-friendly fuel alternatives. These strategic moves help companies strengthen their market position and accelerate the adoption of CNG and LPG-powered vehicles. Below are some key acquisitions and JVs in the recent past:

• 2023: Shell and Quanta Technologies entered into a joint venture focused on developing advanced CNG refueling infrastructure. This partnership aims to improve the accessibility and efficiency of CNG refueling stations worldwide, helping to meet the increasing demand for CNG vehicles.
• 2022: Caterpillar Inc. acquired Navistar International Corporation's CNG engine division to enhance its capabilities in producing natural gas-powered engines. This acquisition allows Caterpillar to expand its portfolio of engines suitable for trucks and heavy-duty vehicles powered by CNG, supporting the ongoing shift toward sustainable fuel options.
• 2022: Hyundai Motor Group and ENGIE formed a strategic alliance to jointly develop and expand the adoption of hydrogen and CNG-powered vehicles in various global markets. Their partnership focuses on improving the infrastructure for alternative fuels, including refueling stations and distribution networks. 
• December 2020: Ford Motor Company showcased its 4th generation self-driving platform, featuring advanced sensors, improved cleaning technology, and upgraded batteries, alongside hybrid and multi-fuel variants, including CNG and LPG, to offer greater fuel flexibility and meet environmental goals.
• November 2020: Honda Motor Company unveiled the prototype for its 9th generation Civic model, expected to be available in the second half of 2021. This model will be compatible with multiple fuel options, including CNG and LPG, reflecting a strong commitment to offering consumers greener choices.

Segment Analysis

By Fuel Type

“The CNG category is expected to dominate the market during the forecast period due to its eco-friendly nature, lower emissions, and cost-effectiveness compared to traditional fuels like gasoline and diesel.”

The CNG and LPG vehicle market is primarily divided into CNG and LPG as the two fuel types. The CNG segment is expected to dominate the market during the forecast period due to its eco-friendly nature, lower emissions, and cost-effectiveness compared to traditional fuels like gasoline and diesel. CNG is increasingly being adopted in passenger vehicles, light commercial vehicles, and heavy-duty vehicles as governments globally implement stricter emissions regulations and provide incentives for cleaner vehicle technologies. The LPG segment, while smaller, is also growing due to similar environmental benefits, particularly in specific markets like Europe and Asia, where LPG is seen as a cleaner alternative to petrol and diesel.

By Vehicle Body Type

“The commercial vehicle segment is expected to remain dominant due to the growing demand for cost-effective and environmentally friendly transport options.

The CNG and LPG vehicle market is segmented by vehicle body type into passenger vehicles, commercial vehicles, and three-wheelers. The commercial vehicles category is expected to remain dominant due to the growing demand for cost-effective and environmentally friendly transport options in industries such as logistics, freight, and public transportation. Commercial vehicles such as buses, trucks, and delivery vans, especially in regions like North America, Europe, and Asia Pacific, are increasingly being converted to CNG and LPG due to government emission regulations and the need to reduce operational costs. "Passenger Vehicles" and "Three-wheelers" are also growing segments, with rising consumer awareness about fuel costs and environmental impacts contributing to the adoption of CNG and LPG in these vehicle categories.

By Vehicle Type

“The Light-duty Vehicle segment is expected to dominate due to the growing preference for smaller, fuel-efficient, and eco-friendly personal transportation options.”

The market is further divided by vehicle type into light-duty vehicles and heavy-duty vehicles. The Light-duty Vehicle segment is expected to dominate due to the growing preference for smaller, fuel-efficient, and eco-friendly personal transportation options. CNG and LPG offer lower fuel costs compared to gasoline and diesel, making them an attractive choice for personal cars, especially in regions where petrol prices are high. The "Heavy-duty Vehicle" segment, while smaller, is expected to grow, driven by the adoption of alternative fuels in freight and logistics vehicles, where reducing fuel costs and meeting emission standards are key drivers.

By Engine System Type

“The Bi-fuel segment is expected to experience the fastest growth due to its flexibility, allowing vehicles to run on both traditional fuels and CNG or LPG.”

The market is segmented by engine system type into dedicated fuel, bi-fuel, and dual fuel. Among these, the Bi-fuel segment is expected to experience the fastest growth due to its flexibility, allowing vehicles to run on both traditional fuels and CNG or LPG. This dual capability provides significant cost savings, especially in countries with fluctuating fuel prices. The "Dedicated Fuel" segment, which involves vehicles running solely on CNG or LPG, is also growing but at a slower pace compared to bi-fuel systems. "Dual Fuel" vehicles, offering the ability to switch between two types of fuel systems, are seeing adoption in heavy-duty applications like trucks and buses due to their ability to meet varying fuel needs while optimizing performance.

By Intake System Type (LPG)

“The Liquid Phase Direct Injection (LPDI) system is expected to grow the fastest due to its higher efficiency, better power delivery, and reduced emissions.”

For LPG, the market is segmented by Intake System Type into converter-mixer systems, vapor phase injection (VPI), liquid phase injection (LPI), and liquid phase direct injection (LPDI). The liquid phase direct injection (LPDI) system is expected to grow the fastest due to its higher efficiency, better power delivery, and reduced emissions. LPDI technology is increasingly favored in LPG conversions as it provides improved fuel consumption and overall engine performance compared to other systems like "Vapor Phase Injection (VPI)," which is expected to witness slower growth.

By Fitting Type

“The OEM/Factory-fitted segment is expected to see the highest growth during the forecast period due to advantages like better integration with the vehicle's systems, warranty coverage, and lower maintenance costs.”

The CNG and LPG vehicle market is segmented by fitting type into OEM/factory-fitted and aftermarket options. The OEM/Factory-fitted segment is expected to see the highest growth during the forecast period. Factory-fitted CNG and LPG vehicles offer several advantages, including better integration with the vehicle's systems, warranty coverage, and lower maintenance costs. While "Aftermarket" conversions are more common due to lower initial costs, the price difference between factory-fitted and aftermarket conversions is expected to narrow as economies of scale grow, making OEM-fitted vehicles more appealing to consumers, especially in markets like Europe and North America.

By Kit Type

“The Sequential Kit segment is expected to experience the fastest growth due to its higher fuel efficiency, better emission control, and smoother performance.”

The market is also segmented by Kit Type into venturi and sequential kits. The sequential kit segment is expected to experience the fastest growth. Sequential kits are known for offering higher fuel efficiency, better emission control, and smoother performance, making them the preferred choice in regions with stringent emission laws, such as North America and Europe. Sequential kits allow for more precise control of the fuel injection system, improving fuel economy and reducing maintenance issues. As the demand for cleaner and more efficient CNG and LPG vehicles rises, the sequential kit segment is expected to expand significantly, especially in the commercial vehicle industry.

By Region

“The Asia Pacific region is projected to hold the largest share of the market by 2026, driven by government policies and increasing demand for low-emission fuel vehicles.”

Geographically, the CNG and LPG vehicle market is segmented into North America, Asia-Pacific, Europe and Rest of the World." The Asia Pacific region is projected to hold the largest share of the market by 2026. This region includes some of the largest markets for CNG and LPG vehicles, such as China, India, South Korea, and Thailand. In these countries, government policies supporting alternative fuel vehicles, coupled with the high cost of petrol and diesel, are driving the adoption of CNG and LPG-powered vehicles. India is expected to be one of the fastest-growing markets due to high petrol taxes and the government's push for cleaner vehicles. China also remains a major player due to its aggressive push for reducing air pollution and dependency on petroleum imports. "North America" and "Europe" are also expected to see steady growth, driven by increasing consumer preference for eco-friendly vehicles and the introduction of stricter emission regulations.

Key Players

The market is moderately fragmented. Most of the major players adopted partnerships, new product launches and jointy ventures to gain in CNG & LPG Vehicle Market The following are the key players in the CNG & LPG Vehicle Market. Some of the major players provide a complete range of services.

Here is the list of the Top Players (Based on Dominance)

• Hyundai Motor Group
• Volkswagen AG
• Ford Motor Company
• Honda Motor Company
• Suzuki Motor Corporation

Note: The above list does not necessarily include all the top players in the market.

Are you the leading player in this market? We would love to include your name. Please write to us at [email protected]

Report Features

This report provides market intelligence most comprehensively. The report structure has been kept so that it offers maximum business value. It provides critical insights into market dynamics and will enable strategic decision-making for existing market players as well as those willing to enter the market. The following are the key features of the report:

• Market structure: Overview, industry life cycle analysis, supply chain analysis.
• Market environment analysis: Growth drivers and constraints, Porter’s five forces analysis, SWOT analysis.
• Market trend and forecast analysis.
• Market segment trend and forecast.
• Competitive landscape and dynamics: Market share, Service portfolio, New Product Launches, etc.
• COVID-19 impact and its recovery curve.
• Attractive market segments and associated growth opportunities.
• Emerging trends.
• Strategic growth opportunities for the existing and new players.
• Key success factors.

The global CNG & LPG Vehicle Market is segmented into the following categories. 

CNG & LPG Vehicle Market by Fuel Type

• CNG (Regional Analysis: North America, Europe, Asia-Pacific, and Rest of the World)
• LPG (Regional Analysis: North America, Europe, Asia-Pacific, and Rest of the World)

CNG & LPG Vehicle Market by Vehicle Body Type

• Passenger vehicles (Regional Analysis: North America, Europe, Asia-Pacific, and Rest of the World)
• Commercial Vehicles (Regional Analysis: North America, Europe, Asia-Pacific, and Rest of the World)
• Three Wheelers (Regional Analysis: North America, Europe, Asia-Pacific, and Rest of the World)

CNG & LPG Vehicle Market by Vehicle Type

• Light-duty Vehicle (Regional Analysis: North America, Europe, Asia-Pacific, and Rest of the World)
• Heavy-duty Vehicle (Regional Analysis: North America, Europe, Asia-Pacific, and Rest of the World)

CNG & LPG Vehicle Market by Engine System Type

• Dedicated Fuel (Regional Analysis: North America, Europe, Asia-Pacific, and Rest of the World)
  • Bi-fuel (Regional Analysis: North America, Europe, Asia-Pacific, and Rest of the World)
  • Dual Fuel (Regional Analysis: North America, Europe, Asia-Pacific, and Rest of the World)

CNG & LPG Vehicle Market by Intake System Type

• Converter-mixer System (Regional Analysis: North America, Europe, Asia-Pacific, and Rest of the World)
  • Vapor Phase Injection (Regional Analysis: North America, Europe, Asia-Pacific, and Rest of the World)
  • Liquid Phase Injection (Regional Analysis: North America, Europe, Asia-Pacific, and Rest of the World)
  • Liquid Phase Direct Injection (Regional Analysis: North America, Europe, Asia-Pacific, and Rest of the World)

CNG & LPG Vehicle Market by Fitting Type

• OEM/Factory Fitted (Regional Analysis: North America, Europe, Asia-Pacific, and Rest of the World)
  • Aftermarket (Regional Analysis: North America, Europe, Asia-Pacific, and Rest of the World)

CNG & LPG Vehicle Market by Kit Type

• Venturi (Regional Analysis: North America, Europe, Asia-Pacific, and Rest of the World)
  • Sequential (Regional Analysis: North America, Europe, Asia-Pacific, and Rest of the World)

CNG & LPG Vehicle Market by Region

• North America (Country Analysis: The USA, Canada, and Mexico)
• Europe (Country Analysis: Germany, France, The UK, Russia, and the Rest of Europe)
• Asia-Pacific (Country Analysis: Japan, China, India, and Rest of Asia-Pacific)
• Rest of the World (Country Analysis: Brazil, Saudi Arabia, and Others)

Research Methodology

• This strategic assessment report from Stratview Research provides a comprehensive analysis that reflects today’s CNG & LPG vehicle market realities and future market possibilities for the forecast period. 
• The report segments and analyzes the market in the most detailed manner in order to provide a panoramic view of the market.
• The vital data/information provided in the report can play a crucial role for market participants and investors in identifying the low-hanging fruit available in the market and formulating growth strategies to expedite their growth process.
• This report offers high-quality insights and is the outcome of a detailed research methodology comprising extensive secondary research, rigorous primary interviews with industry stakeholders, and validation and triangulation with Stratview Research’s internal database and statistical tools.
• More than 1,000 authenticated secondary sources, such as company annual reports, fact books, press releases, journals, investor presentations, white papers, patents, and articles, have been leveraged to gather the data.
• We conducted more than 15 detailed primary interviews with market players across the value chain in all four regions and industry experts to obtain both qualitative and quantitative insights.

Customization Options

With this detailed report, Stratview Research offers one of the following free customization options to our respected clients:

Company Profiling

• Detailed profiling of additional market players (up to three players)
• SWOT analysis of key players (up to three players)

Competitive Benchmarking

• Benchmarking of key players on the following parameters: Service portfolio, geographical reach, regional presence, and strategic alliances

Custom Research: Stratview Research offers custom research services across industries. In case of any custom research requirement related to market assessment, competitive benchmarking, sourcing and procurement, target screening, and others, please send your inquiry to [email protected]