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Friday, July 9, 1999

Ashok Leyland bets on knowhow to corner CNG bus market share 

N Madhavan  
Chennai, July 8: Commercial vehicle major, Ashok Leyland Ltd (ALL) is planning to leverage its experience and proven technology to build up a dominant market share in the CNG bus segment. The CNG bus market, still in a nascent stage, is all set to grow rapidly in view of the recent apex court order which stipulates that all new buses sold in the national capital region this year should have CNG as fuel. Moreover, the court has also ordered that existing vehicles should be converted to use CNG as fuel by 2001.

This has suddenly thrown up a big opportunity for the commercial vehicle manufacturers both for new vehicles and for retrofitting the existing diesel vehicles with CNG kits. The market is expected to be a whopping Rs 600 crore plus in the next two years. Delhi Transport Corporation (DTC) has reportedly indicated that it would take about 1,000 CNG buses this year. By 2001, the total purchases is estimated to be around 2,000.

According to figures furnished by DTC sources, there are about 2,500 buseswith DTC while private bus operators account for another 2,500 buses. In addition, there are about 10,000 contract carriages plying in the region apart from 3,000 school buses. Thus, as much as 18,000 vehicles have to be converted in the next couple of years.

ALL, by virtue of the fact that it is an early starter in this technology (it had developed the CNG prototype in 1987), is all set to exploit the situation. The company has already bagged orders for the first batch of 10 CNG vehicles. It has also indicated to DTC that it would be in a position to supply upto 1,000 vehicles this year. The advantage for ALL is that it is the only manufacturer to have tested the vehicle on road, as its CNG buses are running in Mumbai for the last one year. Telco, its competitor, is also reported to have CNG buses, but is yet to offer them for commercial use.

``We are definitely starting off with an advantage as we have a headstart. Our buses have put in sizeable mileage in Mumbai and we had the opportunity to review itsperformance and debug various problems that cropped up,'' says ALL executive director, marketing, Amol J Sandil. ALL is closely working with DTC on body design of CNG buses based on the experience gained by it, he added. The company has also created necessary infrastructure at its Alwar plant (near Delhi) for manufacturing CNG buses.

According to Sandil, the company is `practically ready' for retrofitment of diesel engines with CNG engines. The company's CNG kits are cheaper than imported kits as it has been indigenised to the extent of 80 to 85 per cent in value terms. The company has responded to the tender issued by the Delhi government for replacement of diesel engines by CNG engines.

CNG is among the cleanest fuel available with almost zero particulate matter. Emission by CNG engines is such that it complies with even Euro-II and Euro-III emission norms. As India has twice as much gas reserves as oil reserves, CNG can reduce the dependence on oil and thereby cut import bill. Gas filling stations arecurrently available in Mumbai and Delhi.

Copyright © 1999 Indian Express Newspapers (Bombay) Ltd.


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