One of the major factors fueling the popularity of compressed natural gas (CNG) and liquified petroleum gas (LPG)-powered vehicles is their lower operating costs than the diesel and gasoline-powered vehicles. In Europe, the cost of CNG lies in the range of around $1.50–$2.80 per gallon on a gasoline-gallon equivalent basis. This means that it is 40–75% cheaper than gasoline or diesel. The companies utilizing CNG-powered trucks often witness payback on the conversion cost within 24–36 months.

Similarly, in the U.S. the cost of LPG is around $2.00 per gallon, which leads to 50% cost savings per gallon when compared to diesel and gasoline. Apart from the low running costs of these vehicles, the expansion of the e-commerce industry is also fueling their demand across the world. As per many reports, the share of e-commerce sales in the global retail sales grew from 10% in 2017 to nearly 14% in 2019.

As a result, the market size is predicted to rise from 56.2 million units in 2019 to 102.3 million units by 2030. Furthermore, the market is expected to advance at a CAGR of 5.9% from 2020 to 2030. Depending on fuel type, the market is bifurcated into LPG and CNG. Between these two, the CNG bifurcation dominated the market in 2019, and it is predicted to exhibit the faster growth in the market in the forthcoming years.

This is credited to the growing deployment of CNG vehicles, especially in the emerging economies of Asia-Pacific (APAC). When vehicle type is taken into consideration, the CNG and LPG vehicle market is divided into bus, light and heavy-duty trucks, and passenger cars categories. Out of these, the passenger car category held the largest share in the market in 2019, mainly because of the huge public awareness about the environmental degradation caused due to the usage of diesel and gasoline-powered vehicles.

Hence, it is safe to say that the demand for CNG and LPG vehicles will soar all over the world in the coming years, mainly because of their lower operating costs than the gasoline and diesel-powered vehicles and the booming e-commerce industry.