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Africa CNG and LPG Vehicle Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

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  • 90 Pages
  • January 2022
  • Region: Africa
  • Mordor Intelligence
  • ID: 5119705

The Africa CNG and LPG Vehicle Market is projected to grow with a CAGR of more than 3 % during the forecast period.

Key Highlights

  • Owing to the decreasing air quality and increasing air pollution in the region, the government is encouraging end users for converting their conventional fuel vehicles to bio-fuel vehicles like, CNG and LPG fuel as these fuels are environment friendly and lower carbon dioxide emissions, switching to CNG can help mitigate greenhouse gas emissions.
  • In 2019, the more than 500 units of SUVs and buses has been successfully converted from petrol to CNG, in Nigeria. The number of vehicles using natural gas in Egypt are about 280,000 cars, served by 187 supply stations and 72 conversion centers.
  • However, the lack of players involved in production of company fitted CNG and LPG vehicles in the region is a restraint for the market. The major conversion of vehicles is done by aftermarket activities using imported kits for conversion.

Key Market Trends

Low Fuel Cost and Government Initiatives Driving Growth

The low fuel cost of Liquified Petroleum Gas and Compressed Natural Gas which reduces the per kilometer driving cost of the vehicles is encouraging more vehicle users especially taxi fleet operators to convert their conventional fuel vehicles to Autogas based vehicles.

The government in Algeria is providing incentives for conversion of conventional fuel vehicles to LPG vehicles by paying 50% of the conversion cost to the supplier directly. The main aim of this scheme by the government is to promote gas-based vehicles in order to reduce the import of crude oil and petroleum products in the country.

In 2018, National Company for Petroleum Products Marketing and Distribution (NAFTAL), Algeria, ordered 40,000 LPG sequential injection systems, which are delivered in 2018 by BRC Gas Equipment, subsidiary of Westport Fuel Systems Inc. In January 2019, around 400,000 vehicles were converted to LPG vehicles in the country. CNG based vehicles are 15% more fuel efficient than diesel-based cars. In July 2019, Tanzania Petroleum Development Corporation has invited bids from investors in compressed natural gas (CNG) to establish fueling stations for vehicles, with an aim to promote CNG vehicles in the country.

Egypt Dominates the Market in Africa Region

In the African region, Egypt is expected to dominate the market over other African countries. The conversion rate of old conventional fuel-based vehicles in the country is rising because of the low operational cost.

In August 2019, the Egyptian government entered into a contract with oil sector and the National Service Projects Agency for the establishment of 54 natural gas refueling installations across 15 governorates, including a number of car-conversion centers, by 30 primary and 24 secondary phase stations divided between the two companies. Furthermore, it is intended that 350 new stations be completed in 6 years after the study and selection of suitable sites. The contracts are valued at EGP 20 million (USD 1.12m) and arise out of the government initiative “Towards Natural Gas”.

The conversion rate of conventional fuel vehicles in the country is growing very rapidly with 14,000 conversions in 2017, 33,000 conversions in 2018 and the deal was done with an aim of 50,000 conversions during the year 2019.

The Egyptian government is spending heavily on providing required infrastructure for promotion of CNG vehicles in the country. The natural gas vehicle (NGV) population in Egypt is approximately 248,000. The conversion program aims to lift the conversion rate of vehicles to about 2,600 per month by encouraging owners to take advantage of low-cost advantages and access to finance for the facilitation and expansion of infrastructure of natural gas fueling stations and conversion centers.

Competitive Landscape

The South America CNG and LPG Vehicle Market is fragmented, with many players accounting for a small market share. Some of the prominent companies in the South America CNG and LPG Vehicle Market are ExoGas, Seat SA, Cummins Inc, BRC Gas Equipments and others. These players are investing heavily in research and development of CNG and LPG vehicles.

For instance, in January 2019, Seat announced that they are expanding the fleet of CNG powered cars. The new SEAT Leon TGI Evo variant has three gas tanks, two of which are made from lightweight carbon fiber composite. These two bigger tanks are situated at the back of the car and have to be stronger to improve vehicle’s safety during traffic accidents. The SEAT Leon TGI Evo has a CNG capacity of 17.7kg, which is enough for 500 km.

Additional Benefits:

  • The market estimate (ME) sheet in Excel format
  • 3 months of analyst support

This product will be delivered within 2 business days.

Table of Contents

1.1 Study Assumptions
1.2 Scope of the Study
4.1 Market Drivers
4.2 Market Restraints
4.3 Porters Five Forces Analysis
4.3.1 Threat of New Entrants
4.3.2 Bargaining Power of Buyers/Consumers
4.3.3 Bargaining Power of Suppliers
4.3.4 Threat of Substitute Products
4.3.5 Intensity of Competitive Rivalry
5.1 Fuel Type
5.1.1 Compressed Natural Gas
5.1.2 Liquified Petroleum Gas
5.2 Vehicle Type
5.2.1 Passenger Cars
5.2.2 Commercial Vehicles
5.3 Sales Channel
5.3.1 OEMs
5.3.2 Aftermarket
6 Geography
6.1 South Africa
6.1.1 Nigeria
6.1.2 Egypt
6.1.3 Others
7.1 Vendor Market Share
7.2 Company Profiles
7.2.1 Seat SA
7.2.2 ExoGas
7.2.3 BRC Gas Equipments
7.2.4 Cummins Inc.
7.2.5 Zavoli
7.2.6 Valtec
7.2.7 African Gas Equipment
7.2.8 EMER

Companies Mentioned (Partial List)

A selection of companies mentioned in this report includes, but is not limited to:

  • Seat SA
  • ExoGas
  • BRC Gas Equipments
  • Cummins Inc.
  • Zavoli
  • Valtec
  • African Gas Equipment
  • EMER