Auto LPG sales rise 34%, to touch 3.25 lt this fiscal

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Nearly seven lakh vehicles in the country run on LPG.

Manu P. Toms

Mumbai, Feb.2

Auto LPG has seen brisk sales this fiscal, thanks to more passenger cars and three-wheelers opting for it as the best alternative to petrol. Consumption of auto LPG grew by 34 per cent at over 2.4 lakh tonnes during April-December, according to the India Auto LPG Coalition (IAC), the industry body representing auto gas distributors.

Nearly seven lakh vehicles in India run on LPG, of which around 1.5 lakh have factory-fitted kits while the rest have retrofitted gas kits. The LPG car models include Maruti's 800, Wagon R, Omni, Hyundai's Santro, Accent, GM's Chevrolet Spark and Tata's Indica Xeta. Others such as Fiat and Skoda plan to follow suit. Bajaj Auto also offers LPG options in its three-wheeler range as well as its Platina motorcycle.

LPG offers mileage that is comparable with petrol and it is one step forward in terms of cleaner emissions and lower price. It costs Rs 31 per kg while petrol is at least Rs 14 more (per litre).

The IAC estimates that consumption of auto LPG this fiscal will touch 3.25 lakh tonnes. “This would have been at least a million tonnes but for the massive diversion of cooking gas that is taking place,” said Mr Suyash Gupta, General Secretary, Indian Auto LPG Coalition.

New filling stations

To cope with growing demand, the network of auto LPG filling stations has now spread over 325 cities/towns with 850 outlets. “In the last 10 months, more than 110 new LPG dispensing units have been commissioned,” he said.

Indian Oil Corporation (IOC) has a 35 per cent share of the market with more than 250 auto LPG filling stations. BPCL and HPCL account for 18 per cent and 16 per cent each, while Reliance Industries has 11 per cent with 135 stations operational. Aegis, with 63 stations, has a 5 per cent share. The auto LPG distributors want the Centre to waive customs and excise duties on auto LPG at all levels in addition to Cenvat exemption for dedicated alternate fuel vehicles.

“Though we have been growing impressively, it is a pity that we are still only a small fraction of the global auto gas business,” said Mr Gupta.

South Korea, Australia and Turkey have promoted the use of LPG as an auto fuel as part of their efforts to improve air quality. In the process, auto gas consumption in South Korea is four million tonnes per annum, followed by Turkey with two million tonnes and Australia with a million tonnes, he said.

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Auto-LPG's success raises oil cos' hopes

(This article was published in the Business Line print edition dated February 3, 2010)
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