The Rising Demand For CNG Vehicles In Indian Market

CNG Vehicles
The Rising Demand For CNG Vehicles In Indian Market

Tata Motors, the largest automotive group in India in terms of revenue, aims to increase the share of compressed natural gas (CNG) vehicles in its overall sales for the fiscal year 2023-24. The company has witnessed strong customer demand for CNG vehicles following the rationalization of natural gas prices by the government. With the recent introduction of the CNG variant of the Altroz small car and the launch of new models in this segment, Tata Motors expects the contribution of CNG vehicles to its sales to reach 10-12% in the current fiscal year, up from 6% in the previous year.

Despite the increase in gas prices, the sales of CNG vehicles experienced a significant surge of 50% in the last financial year. While overall car sales rose by 27% during the same period. This can be attributed to the substantial price difference between CNG and petrol. Which has encouraged customers to consider CNG vehicles as a long-term cost-effective option. Tata Motors currently offers CNG options in its Tiago, Tigor, and Altroz models. Other automakers like Maruti Suzuki and Hyundai have also recognized the potential of CNG vehicles. Especially in the lower end of the market, due to their lower running costs. The current CNG prices in Delhi and Mumbai stand at ₹73.59 per kg and ₹79 per kg, respectively. While petrol costs at ₹96.72 per liter in Delhi and ₹106.31 per liter in Mumbai.

CNG Demand

The increasing popularity of CNG vehicle is evident in the monthly sales figures. Especially, with approximately 34,000-35,000 CNG vehicles being sold in the Indian market. As the network of CNG dispensing stations expands, consumers are gaining more confidence in owning CNG vehicles, further boosting their market share. In the first two months of this year, CNG segment accounted for 13% of all PV’s sold in the country. That is a significant increase from 3.5% in 2009. Market leader Maruti Suzuki, which offers CNG options in 13 different models, has observed a surge in demand for CNG segment. With 26% of their sales in April and May 2023 coming from CNG variants. However, the semiconductor shortage has impacted overall production capacity.

Hyundai, another prominent player in the Indian automotive market, sold 63,058 CNG vehicles last year. The company believes that customers at the entry level prefer the CNG segment due to its cost-effectiveness.


In conclusion, Tata Motors and other automakers are witnessing a growing demand for CNG segment in India. The price differential, coupled with the availability of CNG dispensing stations, has made CNG an attractive and affordable option for customers. With ongoing efforts to expand the CNG vehicle lineup and improve infrastructure. Further, the market share of CNG vehicle continues to rise in the country.

Leave a Reply