Friday, 11 Jul, 2025
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CNG cars were once limited to basic hatchbacks but now include a growing range of sedans and compact SUVs with factory-fitted kits. The broader lineup offers families more affordable, lifestyle-friendly options.
Car buyers in India are changing gears—not with electric vehicles (EVs) just yet, but with compressed natural gas (CNG). As fuel prices stay high and environmental awareness grows, more people are ditching petrol and diesel in favour of CNG-powered cars. This shift may not grab headlines like EVs, but it’s transforming the country’s auto market in ways that matter right now.
CNG cars made up just more than 6 per cent of passenger vehicles (PVs) sales five years ago. Today, they account for nearly 20 per cent, according to data from the Society of Indian Automobile Manufacturers (SIAM). That’s a major leap—and it means CNG is now more popular than diesel. Petrol still leads but has seen its share fall sharply, from over 76 per cent in FY20 to under 58 per cent in FY25.
What’s more, this isn’t a one-off. The coming year is expected to set a new record, with one million CNG cars likely to be sold—up 20 per cent from last year. Overall car sales are barely growing, so CNG is clearly where the momentum lies. In FY25, automakers offered 25 CNG vehicle variants—more than double the 11 available in FY21, according to industry estimates.
The reasons are straightforward. CNG is cheaper to run—often costing half as much per kilometre as petrol or diesel—and it’s cleaner to burn. The government has also expanded CNG refuelling stations across highways and cities, reducing the anxiety drivers once had about running out of fuel.
Carmakers have taken notice. CNG models were once limited to small, no-frills hatchbacks. Now, buyers can choose from a growing number of sedans, compact SUVs, and even MPVs that come with factory-fitted CNG kits. This wider range is helping families find options that suit both their budget and lifestyle.
Still, there are important questions to consider. Can India keep up with rising demand for natural gas? Will global gas prices stay stable enough to keep CNG attractive? And as electric vehicles gradually gain market share, particularly in cities, will CNG hold its ground — or is it just a stepping stone in the broader shift to cleaner mobility?
For now, CNG is winning the race in the segment that matters most: the price-conscious Indian middle class. As automakers and policymakers focus on long-term energy transitions, they shouldn’t ignore what’s happening in the present. India’s fuel mix is shifting — and CNG is leading the way, even if it’s doing so quietly.
Notably, the backbone of the boom is infrastructure. Union Petroleum and Natural Gas Minister Hardeep Singh Puri recently said the number of CNG outlets has risen 20-fold in the past decade. The government aims to scale that to 17,500 stations by 2030, from 7,400 today—a major expansion that’s steadily reducing range anxiety and boosting consumer confidence.
A common drawback of CNG vehicles has been the loss of boot space, as the bulky single-cylinder tanks take up most of the rear compartment. Carmakers like Tata Motors and Hyundai are now addressing this with a twin-cylinder solution—replacing the single large tank with two slimmer cylinders of equal capacity. This design tweak allows for a flatter floor and significantly more usable boot space, making CNG cars more practical for everyday use without compromising on fuel efficiency.
Top automakers are riding the CNG wave with strong double-digit growth. Maruti Suzuki, the country’s top carmaker, sold more than 600,000 CNG vehicles in FY25—roughly one in every three cars it sold. Chairman R C Bhargava expects that number to rise to 700,000 units this year. At Hyundai, CNG cars made up 13.2 per cent of total sales, up from 11.5 per cent a year earlier, with COO Tarun Garg noting their strong appeal in the sub-Rs 11 lakh segment. Tata Motors saw a 50 per cent surge in CNG sales, which now account for a quarter of its total volumes.
Among the top three CNG carmakers, Tata Motors has kept its focus firmly on private buyers, choosing not to sell CNG models to the taxi segment. Hyundai sees a modest 5 per cent of its CNG sales go to fleet operators. Maruti Suzuki, by contrast, dominates this space, with industry estimates suggesting that 70–80 per cent of its fleet sales are CNG-powered. Taxis make up about 6–7 per cent of overall PV market, and around 60 per cent of that segment now runs on CNG—highlighting how commercial operators, too, are pivoting toward cleaner, more cost-effective fuel alternatives.
