With the recent release of the all-electric Nissan Leaf and the range-extended Chevy Volt, America is facing the reality of an electrified vehicle future. However, a new report from Pike Research reveals that consumers should also keep their eyes on the domestic natural gas vehicle market (NGV).
While there is still room for growth in the NGV market here in the United States, other parts of the world will see significantly more NGVs on the road in the coming years. Pike Research predicts that the market will expand to 19.9 million NGVs worldwide by 2016 with anticipated annual sales reaching 3.2 million units.
While international NGV sales may top 3 million per year by 2016, the fueling infrastructure is not expected to keep pace with this strong growth. Pike Research predicts that there will only be 26,000 natural gas refueling stations worldwide by 2016, up from the 18,000 stations in use today.
The slower pace of infrastructure expansion is likely to be more of a concern in parts of the world where natural gas vehicles are more common, specifically Africa, the Middle East, Latin America and the Asia Pacific region. With a current ratio of 685 natural gas vehicles per refueling stations, there is some concern about longer lines at refueling stations once NGV growth begins to explode.
The report goes on to explain what is behind this expected growth in the NGV market. The following four factors have been identified:
- Economics – natural gas is less expensive than gasoline in many regions
- Environmental benefits – NGVs help governments meet greenhouse gas emission reduction goals
- Energy security – using natural gas reduces a country’s reliance on foreign oil
- Availability – some parts of the world have both easy availability of NGVs and a strong support infrastructure in place for vehicle maintenance
Currently, Iran has the largest NGV market but India is expected to step into the first place spot in 2014 with 612,389 units sold annually. This represents a 12.0 percent CAGR. Iran and nearby Pakistan will continue to show strong demand for NGVs during the same time period. NGV drivers in these countries will have to plan ahead for the long lines expected at natural gas stations until the refueling infrastructure catches up.