Maruti's decision to focus on CNG pays off despite Covid-19 pandemic
Premium- In FY21 sales of Maruti’s gas based vehicles increased by 48.11% to 157,000 units, its highest ever, compared to 106,444 units in FY20
Maruti Suzuki’s decision to focus on improving the sales of its compressed natural gas (CNG) powered vehicles has paid off in FY 21 despite the adverse impact of Covid -19 pandemic which impacted sales and production operations of the company. In FY 21 sales of Maruti’s gas based vehicles increased by 48.11% to 157000 units, its highest ever, compared to 106444 units in FY 20.
This comes in a year when total domestic sales of India’s largest car maker declined by 7.8% to 13.61 lakh in FY 21. In terms of quantum increase in sales, this is the biggest since FY 19 when sales jumped to 1.04 lakh units from 74597 units in FY 18.
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CNG vehicles are considered an environment friendly option compared to a petrol and diesel ones. From the beginning of FY 21, Maruti Suzuki decided to phase its diesel vehicles and focused on CNG vehicles to replace the sales of diesel variants.
“We see CNG as a technology that has set a new benchmark in green fuel mobility. Maruti Suzuki offers its customers the widest options of factory-fitted CNG-powered cars. At the same time, CNG is becoming one of the most preferred alternative fuels due to its economic cost of running (as compared with the high prices of petrol and diesel) and improved CNG filling infrastructure," Shashank Srivastava, executive director, marketing sales Maruti Suzuki.
The union government has also been pushing sales of gas-based vehicles to reduce vehicular pollution in cities till the time electric vehicles become viable for customers and fleet operators. As of now Maruti offers CNG engines in eight of its products.
Mint earlier reported that Maruti’s management is planning to sell 2.5 lakh CNG vehicles in FY 22 as increase in refueling stations, hike in prices of petrol and diesel and enhanced awareness amongst customers about vehicular pollution are expected to boost sales.
The union government’s plan to bring CNG within the ambit of Goods and Services Tax, increase refueling stations substantially and its proposal to exempt such vehicles from Green Cess to be levied on older petrol and diesel run vehicles will also help improve prospects of such vehicles.
“If both prices of petrol and diesel goes up then the cost of running cars go up. Considering that CNG is a very good option for customers. If you look at the sales of CNG cars, then it has increased dramatically. Even this year (April to Jan) Maruti’s CNG vehicle sales have increased by about 28% while the overall market is down by 16%. If you look at last year also when overall sales were down by 18% in FY 20 but CNG sales were up by almost 16%," said Srivastava, in an interview to Mint, earlier this year.
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