The Compressed Natural Gas (CNG) and Liquefied Petroleum Gas (LPG) vehicle market is an important segment of the automotive industry, focusing on the manufacturing and distribution of eco-friendly, cost-efficient vehicles worldwide. These include CNG passenger cars, LPG passenger cars, CNG commercial vehicles, LPG commercial vehicles, and others. Vehicles are equipped with various engine systems such as dedicated, bi-fuel, and dual-fuel systems.
The market is gaining traction due to rising gasoline and diesel prices, coupled with increasing environmental awareness and government incentives. Additionally, the parallel growth of the hybrid vehicle industry is positively influencing demand.
Market Overview
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Market Size 2024: USD 3.93 Billion
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Projected Market Size 2034: USD 6.75 Billion
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CAGR (2025–2034): 4.93%
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Leading Region: Asia Pacific
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Segmentation: By Vehicle Type, Fuel Type, Sales Channel, and Region
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Key Players: Maruti Suzuki, Nikki Co. Ltd., Kion Group, Hyundai Motor Company, IVECO, Mahindra & Mahindra
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Regional Highlights
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Asia Pacific holds the largest market share, driven by strong demand in India, China, Japan, and South Korea.
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North America is set for strong growth due to eco-friendly truck adoption and investment in CNG infrastructure.
Market Segmentation Insights
By Vehicle Type
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Passenger Cars: Largest segment, boosted by demand in mid-income countries like India, Vietnam, and Egypt.
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LCVs (Light Commercial Vehicles): Expected to grow rapidly, especially in logistics, construction, and e-commerce.
By Fuel Type
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CNG Segment: Dominates due to affordability and performance efficiency.
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LPG Segment: Projected for strong growth owing to autogas adoption and government initiatives.
By Sales Channel
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OEM: Leads with factory-fitted systems ensuring warranty and quality assurance.
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Retrofitting: Rising in popularity due to affordability and the availability of skilled aftermarket services.
Recent Industry Developments
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April 2025: Hyundai Motor India launched Exter CNG with a 1.2-litre Kappa petrol engine.
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September 2024: Tata Motors launched Nexon CNG SUV with 17.44 km/kg mileage.
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January 2025: Mahindra introduced Veero CNG for short-distance goods transport.
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April 2025: Honda launched Elevate CNG in India.
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Leading Companies – Profiles
1. Maruti Suzuki
About: India’s largest car manufacturer with a significant presence in the alternative fuel vehicle market.
Products: Alto CNG, Wagon R CNG, Swift CNG.
Market Cap: Approximately USD 45 billion.
2. Nikki Co. Ltd.
About: Japan-based manufacturer specializing in fuel system components for CNG and LPG vehicles.
Products: Gas regulators, injectors, and LPG conversion kits.
Market Cap: Approximately USD 1.2 billion.
3. Kion Group
About: A German multinational specializing in industrial vehicles and equipment, including LPG-powered forklifts.
Products: LPG forklifts, warehouse equipment, automated transport systems.
Market Cap: Approximately USD 7.5 billion.
4. Hyundai Motor Company
About: A South Korean automotive giant with a growing green mobility portfolio.
Products: Exter CNG, Aura CNG, Santro CNG.
Market Cap: Approximately USD 38 billion.
5. IVECO
About: An Italian commercial vehicle manufacturer known for CNG-powered trucks and buses.
Products: S-Way CNG, Daily Natural Power.
Market Cap: Approximately USD 3.5 billion.
6. Mahindra & Mahindra
About: Indian multinational automaker producing a wide range of passenger and commercial vehicles.
Products: Supro CNG, Veero CNG.
Market Cap: Approximately USD 27 billion.
Conclusion
The CNG and LPG vehicle market is set for steady expansion over the next decade, driven by cost efficiency, environmental benefits, and technological advancements. With Asia Pacific leading the market and North America showing promising growth, companies are expected to continue innovating and forming strategic collaborations to maintain their market position.
Frequently Asked Questions
What is driving the growth of the CNG and LPG vehicle market?
The growth is driven by rising fuel prices, environmental concerns, and government incentives for clean energy vehicles.
Which region dominates the global CNG and LPG vehicle market?
Asia Pacific leads the market due to high demand in countries like India and China.
Which vehicle type holds the largest market share?
Passenger cars dominate the market, particularly in mid-income countries.
Who are the major players in the CNG and LPG vehicle industry?
Key players include Maruti Suzuki, Nikki Co. Ltd., Kion Group, Hyundai Motor Company, IVECO, and Mahindra & Mahindra.
What is the expected CAGR of the market from 2025 to 2034?
The market is expected to grow at a CAGR of 4.93% during this period.
Source : https://www.towardsautomotive.com/insights/cng-and-lpg-vehicle-market-sizing
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