This article first appeared in ThePrint on June 12, 2022.
Compressed Natural Gas (CNG) vehicles have steadily shed their “downmarket” image, becoming a key player in India’s evolving automotive landscape. Despite significant price hikes in recent months, the demand for CNG-powered cars remains robust, driven by both consumer cost-consciousness and automakers’ strategic offerings.
In March 2022, just weeks after the Russian invasion of Ukraine, the Indian government allowed oil marketing companies to adjust fuel prices. Consequently, CNG prices surged dramatically, with Indraprastha Gas Limited (IGL), a major distributor in the National Capital Region, raising rates 13 times by May 21, 2022. The price of CNG soared to ₹75.61/kg, marking a substantial increase of ₹19.60 per kilogram since March. Unlike petrol or diesel, CNG users received no relief in excise duties, directly feeling the impact in auto fares and gas bills.
Despite this steep increase, CNG vehicle sales have defied expectations, demonstrating that their value proposition continues to resonate with Indian consumers. This trend has significantly benefited automakers like Tata Motors, one of India’s leading automobile manufacturers. Known for its innovation and commitment to cost-effective mobility, Tata Motors has leveraged CNG’s growing popularity to drive impressive sales numbers.
Tata Motors introduced the iCNG variants of its Tiago hatchback and Tigor compact sedan in January 2022. These variants have been instrumental in boosting the brand’s performance in the fiercely competitive passenger vehicle segment. Together, the Tiago and Tigor have consistently delivered monthly sales of 8,500–9,000 units. Remarkably, the iCNG models account for 52% of these sales, underscoring their importance in Tata Motors’ lineup.
The appeal of CNG vehicles lies in their cost efficiency, especially as petrol and diesel prices remain volatile. For consumers seeking lower running costs, CNG cars offer a practical alternative, making them increasingly popular among both individual buyers and fleet operators. Tata Motors’ strategic pricing and features for the Tiago and Tigor iCNG models have further enhanced their appeal.
While rising CNG prices have posed challenges, the sustained demand underscores a shifting perception of CNG vehicles. No longer confined to taxis or commercial fleets, they are now a mainstream choice for budget-conscious yet discerning car buyers. As India continues its journey toward sustainable and affordable mobility, CNG vehicles are likely to play an even more prominent role in shaping the automotive market…
Read more: ThePrint
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