Maruti continues to bet big on CNG cars

Target Date - March 31, 2022

When everyone is going aggressive on Electric Vehicles (EVs), Maruti Suzuki India (MSI) continues to focus greater and greater on CNG cars.

It expects it’s CNG car sales to almost double this fiscal year over 2020-21.

Key points to note –

  • Around 1.9 lakh CNG cars were sold in the country in FY 21 with MSI alone retailing over 1.6 lakh units. It expects this number to be around 3 lakh cars in the current year i.e., FY 22.
  • Over the last few years, MSI has witnessed significant growth in CNG car sales. It sold 74,000 units in 2016-17; around 1 lakh units in 2018-19; 1.05 lakh units in 2019-20; and 1.62 lakh units in 2020-21.
  • Out of the total of 15 models that MSI offers, CNG option is available in 7 models currently and more models will be included gradually. CNG option is currently available in Alto, S-presso, WagonR, Eeco, TourS, Ertiga and Super Carry. MSI is expected to soon offer it also in the newly upgraded Celerio.
  • Maruti’s bullishness on CNG is due to the lower running costs, proven technology and increasing network of CNG stations across the country. CNG is expected to reach across 330 cities by next year compared with 143 cities three years ago and 293 cities currently. Compared with 1,400 filling stations, there are 3,300 stations currently with an expectation of 8,700 in the next 1.5 years.

MSI continues to work very differently from what the majority believes. It was the first car maker to have discontinued offering diesel vehicles last year. Reason – reducing gap between diesel and petrol prices.

At that time it seemed like a poor strategy. However, it does seem to make sense now. In 2013-14, diesel cars accounted for 60 per cent of the overall sales, now it has come down to less than 17 per cent.

Likewise, MSI has been very vocal about why EV adoption would take time.

In the interim, they have identified CNG to be the alternative and if one ignores the EV narrative, CNG does seem to make lot of sense… and the numbers are proving it.

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