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Automotive Natural Gas Vehicle Market

Market Insights on Automotive Natural Gas Vehicle covering sales outlook, demand forecast & up-to-date key trends

Automotive Natural Gas Vehicle Market By Fuel Type (Compressed Natural Gas, Liquefied Petroleum Gas), by Vehicle Type (Passenger Cars, Commercial Vehicles) & Region - Forecast 2022 - 2032

Automotive Natural Gas Vehicle Market Overview

The automotive natural gas vehicle market is still in the nascent state, though the market experienced growth in sales in the last 3-To 4 years. From 2022 to 2032, the market is expected to surge at a CAGR of 7%.

An automotive natural gas vehicle uses compressed natural gas (CNG) or liquified natural gas (LNG) as an alternative to diesel and petrol. Natural gas is widely used in lift trucks, buses, light, and heavy trucks, motorcycles, cars, vans, and locomotives.

Natural gas provides an economical and environmentally friendly option over diesel or petrol. Currently, the penetration of the automotive natural gas vehicles is less globally, but due to its operational advantages, in the future, the penetration is expected to increase.

Which are Some Prominent Drivers Spearheading Automotive Natural Gas Vehicle Market Growth?

As an alternative fuel, Natural gas is gaining popularity across the globe, owing to easy availability, lower vehicular emissions, and lower costs compared to regular fuels, such as gasoline and diesel.

The increasing need for alternative fuel solutions in the transportation segment is reassuring the players in the transportation industry to adopt Liquefied Natural Gas (LNG) trucks to route their operations.

Consequently, LNG vehicles are witnessing a burgeoning demand in the transportation industry. Besides, the mounting government initiatives for the development of natural gas distribution infrastructure are likely to further the demand for natural gas vehicles (NGVs) in the forthcoming future.

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What are the Challenges Faced by the Automotive Natural Gas Vehicle Industry?

Electric vehicles are gaining huge traction in the European region & the Asia-pacific region, thereby creating a tough challenge for the expansion of the automotive natural gas vehicles in these regions.

Due to low operation cost and maintenance cost, electric vehicle contributes to the shifting of the consumer focus from natural gas-powered vehicles to electric vehicles. Henceforth, this is one of the significant restraining factors of the market.

Further, the abruption in the mining and supply chain of natural gas due to the prevalence of social issues like riots, a war in reserve lands, creates a hurdle in the growth of the global NGV market.

Why is Asia-Pacific Emerging as an Opportunistic Automotive Natural Gas Vehicle Market?

The Asia Pacific region accounted for more than 55% in 2021 and is expected to maintain its lead in the global market, recording a significant CAGR throughout the forecast period. This market growth is propelled by soaring production and sales of passenger cars in the province.

China accounted for nearly ½ section of the passenger car sales in APAC. The region is recognized as the largest adopter of NGVs on account of natural gas infrastructure development in countries, such as India, China, and Pakistan.

China is likely to show a surge in CNG as well as LNG usage as an enormous infrastructural growth is expected and natural gas will support the operators to enhance their operating costs. Numerous incentives by the government which are offered to encourage the adoption of natural gas act as primary drivers of market growth.

Nikhil Kaitwade
Principal Consultant
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How is Europe Contributing to the Growth of the Automotive Natural Gas Vehicle Market?

According to the German Association of the Automotive Industry (VDA), in Europe, 5.1 million passenger cars were registered in the first half of 2021, which is 39% less compared to 2020. Hence, the European market is likely to witness sluggish growth throughout the forecast period.

Owing to the poor infrastructure, the European countries are less keen towards natural gas production, except Italy. Likewise, European countries are more engrossed on manufacturing and selling hybrid and electric rather than natural-gas-powered vehicles, which is hindering the growth.

Why the United States Holds a Significant Share in the Automotive Natural Gas Vehicle Market?

Natural gas is in plentiful supply in the United States, and the United States. is the world’s lowest-cost producer. Hence, it opens a plethora of growth opportunities for the Automotive natural gas vehicle market. Moreover, the increase in the extraction of shale gas across the U.S. has augmented the supply of natural gas.

This substantial increase can be attributed to the prompt growth of alternative gas sources and shales since 2008, combined with developing advanced drilling technologies, such as fracking. Consequently, natural gas prices have reduced since 2008 for both commercial and residential consumers.

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Market Competition

Some of the key participants present in the global demand of the automotive natural gas vehicle market include Ford Motor Company, Hondo Motor Company, Volkswagen and Hyundai Motor Corp among others.

Scope Of Report

Report Attribute

Details

Growth Rate

CAGR of 7% from 2022 to 2032

Base Year for Estimation

2021

Historical Data

2015-2020

Forecast Period

2022-2032

Quantitative Units

Revenue in USD Billion, Volume in Kilotons and CAGR from 2022-2032

Report Coverage

Revenue Forecast, Volume Forecast, Company Ranking, Competitive Landscape, Growth Factors, Trends and Pricing Analysis

Segments Covered

  • Fuel Type
  • Vehicle Type
  • Region

Regions Covered

  • North America
  • Latin America
  • Western Europe
  • Eastern Europe
  • APEJ
  • Japan
  • Middle East and Africa

Key Countries Profiled

  • U.S
  • Canada
  • Brazil
  • Argentina
  • Germany
  • U.K
  • France
  • Spain
  • Italy
  • Nordics
  • BENELUX
  • Australia & New Zealand
  • China
  • India
  • ASEAN
  • GCC
  • South Africa

Key Companies Profiled

  • Ford Motor Company
  • Hondo Motor Company
  • Volkswagen and Hyundai
  • Motor Corp

Customization

Available Upon Request

Key Segments Covered in the Automotive Natural Gas Vehicles Market Report

Fuel Type:

  • Compressed Natural Gas (CNG)
  • Liquefied Natural Gas (LNG)

Vehicle Type:

  • Passenger Vehicles
  • Commercial Vehicles

Region:

  • North America
  • Latin America
  • Western Europe
  • Eastern Europe
  • APEJ
  • Japan
  • Middle East & Africa

Frequently Asked Questions

FMI expects the automotive natural gas vehicles market to soar at a CAGR of 7% until 2032

Asia Pacific is the most opportunistic market, accumulating 55% revenue in 2021

Ford Motor Company, Hondo Motor Company, Volkswagen and Hyundai Motor Corp are some key automotive natural gas vehicle manufacturers

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Nikhil Kaitwade
Principal Consultant
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Automotive Natural Gas Vehicle Market