Automotive Natural Gas Vehicle (NGV) Market Size, Share & Industry Analysis, By Type (CNG Vehicle and LNG Vehicle), By Application (Passenger Cars and Commercial Vehicles), Covid-19 Impact, Regional Insights, and Forecast from 2024 To 2031

Updated On: 01 April 2024

AUTOMOTIVE NATURAL GAS VEHICLE (NGV) MARKET REPORT OVERVIEW

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The global automotive natural gas vehicle (NGV) market is projected to grow from USD 8530 million in 2021 to USD 17074.48 million by 2031 and exhibit a stellar CAGR of 7.5% during the forecast period.

Natural gas is a cheaper and cleaner alternative to diesel and gasoline. Natural gas has witnessed steep demand in recent years due to diesel and petrol's disruptive and fluctuating pricing structure. The economic instabilities in the oil and gas industry due to several factors, such as the dynamic oil demand and supply, unstable strength of the US dollar, and the expansion of power-intensive industries including manufacturing, transportation, and electricity, resulting in volatile crude oil prices. These factors increase the demand for automotive natural gas (NGV) and foster market growth. Additionally, governments around the globe are implementing stringent regulations for environmental protection and reducing greenhouse gas emissions. These are likely to foster growth for the automotive natural gas vehicle (NGV) market in the forthcoming years.

COVID-19 IMPACT

"Market to Gain Steep Traction Post-Pandemic "

The unpredicted emergence of the COVID-19 pandemic has caused unprecedented challenges to the growth of several industries and markets, including the automotive natural gas vehicle (NGV) market. The implementation of stringent government restrictions such as curfews and lockdowns halted the vehicle movement and reduced demand for automotive natural gas vehicles (NGV). The high unemployment rates and the shift in consumer focus on essential expenditures have resulted in a declined demand for vehicles. The closure of production facilities due to stringent lockdowns have impacted the market growth. Additionally, the global supply chain network disruptions due to the worldwide trade ban and halted air transport have aggravated the situation. Nonetheless, vaccines are available to the global population, and the market is slowly recovering. The automotive natural gas vehicle (NGV) market is expected to gain steep traction post-pandemic.

LATEST TRENDS

"CNG Vehicle to Gain Immense Growth in the Coming years"

CNG vehicle segment held the lion’s share in 2020. The demand for CNG vehicles is expected to reach approximately 36,758.09 thousand units by the end of 2028. CNG vehicles produce less noise levels and operate smoothly. CNG is a cheaper alternative to petrol and produces low emissions on combustion. Numerous automotive manufacturers are launching CNG versions of existing vehicles to attract consumers. For instance, Maruti Suzuki has teased its specifications of the new upcoming CNG version of Swift. Swift CNG is expected to launch by the end of 2021 in India.  Additionally, due to the growing demand for CNG vehicles, the governments of several nations are making huge investments to construct new CNG and LNG refueling stations. These are likely to foster growth for the automotive natural gas vehicle (NGV) market.

AUTOMOTIVE NATURAL GAS VEHICLE (NGV) MARKET SEGMENTATION

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Based on type, the market bifurcates into CNG vehicles and LNG vehicles. Out of these, the CNG vehicle segment is expected to witness the highest growth in the market due to its wide adoption. Based on application, the market segments into commercial vehicles and passenger cars. Geographically, the market is classified into four major regions- North America, Asia Pacific, Europe, and the Rest of the World.

DRIVING FACTORS

"Fuel Price Difference to be a Key Growth Driver"

Automotive natural gas is cheaper than diesel and gasoline. It is abundantly available and also has low carbon content. Though the automotive natural gas vehicle (NGV) cost higher than conventional vehicles, they provide better operational costs than conventional vehicles. Due to the dynamic demand and supply, the fluctuating crude oil prices are expected to boost the demand for the automotive natural gas vehicle (NGV) and boost the market growth. The degrading air quality due to the surging air pollution caused by diesel and gasoline operated vehicles are another factors that are expected to bolster the global automotive natural gas vehicle (NGV) market in the coming years. The reduced fuel price reduces the overall cost of ownership of vehicles and is therefore anticipated to surge the market growth.

"Favorable Government Regulations to Boost the Market Growth"

The increasing environmental impact of gasoline and diesel-operated vehicles has induced several nations' governments to implement stringent emission regulations. The implementation of these stringent regulations is likely to augment the adoption of automotive natural gas vehicles (NGV) and accelerate the market's growth. Moreover, the government of various nations is acquiring natural gas buses to reduce the carbon footprint and save on fuel. The utilization of natural gas helps the governments to limit the direct impact of the increasing crude oil prices and is therefore anticipated to fuel the market growth. Additionally, the governments of major economies are constructing new natural gas refueling stations to bolster the natural gas infrastructure. The construction of new natural gas refueling stations is expected to boost the growth of the market.

RESTRAINING FACTORS

"High Refueling Time & Low Number of Refueling Stations to Hinder Market Growth"

Automotive natural gas vehicle (NGV) take longer refueling time than diesel or petrol vehicles. The consumers end up in long queues due to the longer refueling period of natural gas vehicles. Additionally, there is a low number of refueling stations for NGVs due to weak natural gas infrastructure. These factors are expected to hinder market growth.

AUTOMOTIVE NATURAL GAS VEHICLE (NGV) MARKET REGIONAL INSIGHTS

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"Asia Pacific to Dominate the Global Market Due to Surging Production and Sales of Vehicles"

Asia Pacific is anticipated to witness the highest growth in the global automotive natural gas vehicle (NGV) market share. Asia Pacific held approximately 53% of the total market share in 2020 and is expected to exhibit the highest CAGR in the forthcoming years. The growth is attributable to the surging production and sales of passenger cars. Asia Pacific is the largest adopter of automotive natural gas vehicles, and China is anticipated to lead the market growth in the region. The growing government support to develop the NGV infrastructure across India, Pakistan, and China is anticipated to boost the market's growth. For instance, the Indian Ministry of Petroleum and Natural Gas launched the City Gas Distribution policy to expand the CNG infrastructure across India.

North America is projected to gain immense growth in the upcoming years. The large reserves of natural gas and the growing extraction of shale gas across the United States augment the supply of natural gas and are anticipated to be the key growth drivers for the market. The swift development of unconventional gas sources and shales, coupled with the transforming drilling technologies, including fracking, will likely decrease natural gas prices and boost its consumption across residential and commercial sectors.

Europe is anticipated to witness substantial growth in the global market. The growing government regulations to curb carbon emissions are anticipated to boost market growth. Additionally, the deployment of new natural gas refueling stations is expected to surge the market growth.

The Rest of the World is anticipated to witness considerable growth in upcoming years due to rapid urbanization and decreasing natural gas prices.

KEY INDUSTRY PLAYERS

"Key Players to  Launch New Vehicles to Accumulate Growth"

The key players in the market devise ingenious growth strategies to generate greater revenues and strengthen their market presence. They adopt various growth strategies such as new product launches, partnerships, mergers, acquisitions, collaborations, and others to improve the market positions.

List of Key Market Players Profiled:

• Maruti Suzuki
• Volkswagen
• Fiat
• Honda
• General Motors
• Renault
• Hyundai
• Ford
• Iran Khodro
• Volvo Group
• PSA
• C&C Truck
• Tata Motors

KEY INDUSTRY DEVELOPMENTS:

 June 2020: Maruti Suzuki launched the CNG version of S-Presso in India. Maruti Suzuki India’s sales have risen by 48% during the financial year 2020-21.

August 2020: Tata Motors launched Tiago NRG, which is a facelift version of Tiago and is available in a CNG version.

REPORT COVERAGE

The global automotive natural gas (NGV) market report offers a detailed assessment of the market and emphasizes several critical factors, such as components, end-users, applications, and pioneering companies. Besides this, the report offers vital insights into the ongoing market trends and highlights key industry developments. In addition to the above-mentioned factors, the report envisages significant factors contributing to the market’s growth in recent years.