Hyundai Bets on CNG Vehicles, Sees Growing Demand in Rural, Urban India
Hyundai Motor India Ltd (HMIL) is significantly ramping up its focus on CNG-powered vehicles, with demand surging in both rural and urban markets across India. The company currently offers CNG variants in three of its models – the Grand i10 NIOS, AURA, and EXTER. Since the launch of these CNG models, the proportion of Hyundai’s total domestic sales has seen substantial growth. The share of CNG vehicles in Hyundai’s sales increased from 9.1% in FY22 to 11.4% in FY24, and further rose to 12.8% in the first half of FY25.
Growing Demand for CNG Vehicles
Hyundai’s push into the CNG market comes in response to the rising demand for fuel-efficient, environmentally friendly, and cost-effective transportation options across various customer segments. According to Tarun Garg, Whole-time Director and COO of HMIL, India now boasts a CNG network of over 7,000 stations, with plans to expand this network to approximately 17,500 by 2030. This expansion is expected to drive further growth in CNG vehicle adoption.
Introduction of Hy-CNG Duo by Hyundai
To enhance its CNG offerings, Hyundai introduced the ‘Hy-CNG Duo’ system, which features dual cylinders for increased boot space and higher fuel efficiency. The system is available in the EXTER and Grand i10 NIOS models, addressing customer demands for more mileage, safety, and ample space. The introduction of the Hy-CNG Duo helped Hyundai reach its highest-ever CNG vehicle penetration of 14.9% in October 2024.
The company-fitted CNG system is backed by a three-year warranty, providing added assurance to customers. Additionally, the Hy-CNG Duo is equipped with an integrated ECU that ensures smoother and faster transitions between petrol and CNG fuel modes, further improving the driving experience.
Increased CNG Penetration Across Markets
Hyundai has seen significant growth in the penetration of CNG models, particularly in compact cars like the Grand i10 NIOS, where CNG penetration reached 17.4% in October 2024. The EXTER mini-SUV saw a penetration of 39.7%, while the AURA compact sedan achieved nearly 90.6%.
CNG adoption has also been strong in rural markets, with penetration growing from 7.1% in FY22 to 12.0% in FY24. In urban markets, CNG vehicle penetration rose from 8.8% in FY22 to 10.7% in FY24. The top three cities for Hyundai’s CNG vehicle sales are Pune, New Delhi, and Ahmedabad, while Maharashtra, Gujarat, and Uttar Pradesh are leading in state-level sales.
Rival Brands Join the CNG Push
Hyundai’s growing focus on CNG vehicles aligns with the strategies of its competitors, including Maruti Suzuki India and Tata Motors. Maruti Suzuki has set an ambitious target of selling 6 lakh CNG vehicles in FY25, up from 4.89 lakh units in FY24. Tata Motors has also seen growth in CNG vehicle penetration, with CNG models now accounting for 21% of its passenger vehicle sales in FY25, up from 16% in FY24.
The Road Ahead
The steady growth in Hyundai’s CNG vehicle sales highlights the increasing trend toward alternative fuel options in India, driven by environmental concerns and a demand for more economical, fuel-efficient mobility solutions. With an expanding network of CNG stations and a growing consumer base, Hyundai is positioning itself to lead the country’s CNG vehicle market.