Annual Sales of Natural Gas Vehicles will Reach 3.2m Worldwide by 2019

The global market for light-duty natural gas vehicles, including passenger cars, light duty trucks and commercial vehicles, is expected to grow at a compound annual growth rate of 6.2% between 2012 and 2019, reaching 3.2 million vehicles sold in 2019, according to a new forecast by Pike Research.

This translates into a cumulative total of 25.4 million light-duty natural gas vehicles (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).

The market for NGVs varies significantly by region and country. In North America, the market is largely focused on fleet vehicles such as vans, pickup trucks, and cars used for couriers and taxis. In Europe, Italy is one of the largest markets with a variety of vehicles used by both consumers and fleets, while other countries with small numbers of NGVs are currently focused on building refueling infrastructure to increase the appeal of NGVs for fleets and public usage.

The Asia Pacific region remains the largest region due to Pakistan and the growing Chinese and Thai markets. The markets in Pakistan and Ukraine will see volatility due to shifting focus from imported compressed natural gas (CNG). Smaller markets where growth has been strong will likely start to see market saturation in the next several years followed by slowing market sales.

The global market for LD NGVs varies significantly depending on the region and country:

- North America: The LD truck segment leads the North American 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. The vast majority of NGVs are vehicles that automotive OEMs have prepped with engine upgrades and then sent to suppliers to install the CNG equipment. Almost all of these vehicles are built to order. Honda is currently the only OEM to manufacture a CNG passenger car (the Civic GX) for the North American market, though the sales volumes for this vehicle are very small in comparison to the sales of other Honda Civics.

- Latin America: Latin America is one of the few regions where 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). The 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.

- Europe: The European NGV market varies widely between countries. Ukraine and Italy are the largest LD NGV markets (2012 sales will reach 151,487 and 159,046 respectively). In both countries, OEM factory-built vehicles from Fiat and other manufacturers run on CNG and the refueling infrastructure is 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.

- Asia Pacific: Pike Research forecasts the Asia Pacific market to grow to become the largest market for NGVs later this decade, thanks to strong growth in a variety of markets including: Thailand (24% CAGR), India (23%), and China (20%). Pakistan also has a large fleet of NGVs, but the market has seen a lot of volatility as the government looks to reduce strains on the country’s NG supplies. Smaller markets like Uzbekistan and Armenia have seen tremendous growth in NGV conversions of existing vehicles in the past, but are likely to face NGV market saturation by mid-decade, which will slow sales growth considerably.

- Middle East/Africa: 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. Outside these two markets, very little demand exists for NGVs in Africa.

Natural gas vehicles typically run on CNG because the tanks for CNG are lighter weight and less costly than liquefied natural gas (LNG). Natural gas must be cooled to -259 F (-160 C) to be liquefied and stored in insulated containers.

[source: Pike Research]