The global market for light-duty (LD) natural gas vehicles (NGVs)—including passenger cars, light-duty trucks and commercial vehicles—will experience a compound annual growth rate (CAGR) of 6.2% between 2012 and 2019, reaching 3.2 million vehicles sold in 2019, according to a new forecast by Pike Research. This level of sales results in a cumulative total of 25.4 million LD NGVs on the road by 2019. LD NGVs make up about 97% of the total NGV market (2.08 million vehicles out of 2.15 million vehicles in 2012).
Asia Pacific will become the largest market for NGVs, according to the Pike report, “Light Duty Natural Gas Vehicles”, due to strong growth in a variety of markets including: Thailand (24% CAGR); India (23%); and China (20%). Although Pakistan also has a large fleet of NGVs, its market has been volatile as the government looks to reduce strains on the country’s NG supplies, according to the report.
Light-duty NGVs typically run on compressed natural gas (CNG) because the tanks for CNG are lighter weight and less costly than those for liquefied natural gas (LNG), the report notes. The global market for LD NGVs varies significantly depending on the region and country. Aside from Asia Pacific:
- In North America, the truck segment leads the LD NGV market because the market largely consists of fleet purchasers rather than individual consumers. Fleet sales of NGVs are growing at a rate of 10.8% annually in North America, according to Pike.
- In Latin America, the consumer market is larger than the fleet market. This market is also home to two of the largest NGV markets in the world: Argentina and Brazil (combined, they account for 25% of total NGVs globally). Other markets in Latin America combined have sales of less than 100,000 vehicles in 2012, but Pike Research expects to see strong growth (about 10% CAGR each) over the next several years.
- In Europe, the market varies widely between countries. Ukraine and Italy are the largest LD NGV markets (2012 sales will reach 151,487 and 159,046 respectively), with OEM factory-built vehicles from Fiat and other manufacturers running on CNG and with a refueling infrastructure largely in place to support a retail market for the vehicles. Other markets in Europe continue to struggle with growing refueling infrastructure fast enough to meet the needs of both consumers and fleets, the report notes.
- The Middle East is home to the largest market for LD NGVs, Iran. Egypt also has a relatively strong light duty vehicle (LDV) market, particularly among taxi fleets. There is very little demand for NGVs outside of Egypt in Africa. Pike Research expects the Middle East and Africa regions to remain relatively flat overall (2% CAGR between 2012 and 2019), largely due to the volatility in the Iranian market.
This report identifies four main drivers for LD NGV adoption: economic benefits; environmental benefits; availability of fuel and vehicles; and energy security.
NGVs offer lower emissions of greenhouse gas (GHG), particulate matter (PM), and nitrogen oxide (NOx) than gasoline or diesel-powered vehicles. As governments look to reduce GHG emissions from LDVs, NGVs are seen as a tool to meet those requirements, particularly in Europe, the report notes.