Country is likely to see more used car arrivals of high engine capacity under gift, transfer of residence and baggage schemes after the budgetary decision of increasing depreciation allowance from one per cent to two per cent on used car imports.
Long lines at the CNG stations indicate that the demand of this relatively cheap fuel is rising. “Long queues of vehicles at the CNG dispenser at gas stations give an impression that the CNG will replace petrol in years to come. The real scenario, however, appears to be quite different,” observed an analyst.
“I think the petrol consumption will witness a growth of 5-6 per cent in 2005-2006 from 1.3 million tons in 2004-2005,” secretary general, Oil Companies Advisory Committee (OCAC), Abid Saeed Ibrahim said, linking the possible growth in petrol demand to the entry of new bikes and cars of fuel efficient engine. Petrol consumption in 2002-2003 was 1.25 million tons.
He said that CNG was popular among holders of lower capacity engine and older model cars and those who had higher capacity engine cars still believe that they could afford petrol. He was of the view that many people were apprehensive as they considered gas unsafe and insecure.
Consumers driving high capacity engine cars felt that Rs50 per litre was not worrisome but they might switch to CNG if petrol prices witnessed a very drastic increase, he said. However, it was difficult to explain what would be the level of drastic increase in petrol rate.
In June alone, there was a growth of 11 per cent in petrol consumption as compared to previous year’s June, he added.
Since the petrol prices have touched Rs50 a litre level, it had been witnessed at the pumps that people, even using the 800-1,000cc cars, are now fuelling petrol as per their need.
Pump dealers said that the rush for CNG has increased after July 1 and people are now making queues for the gas while there are fewer buyers of petrol at stations.
At some stations, people driving Toyota Corolla and Honda Civic cars are seen becoming part of the queues dominated by small and older cars but the numbers of big engine capacity cars are very few.
“CNG is still cheaper by 54.54 per cent from consumption point of view than petrol. The low price factor and huge saving are driving many consumers crazy,” president CNG Station Owners Association of Pakistan, Malik Khuda Bux said.
He said that CNG stations, which had been set up to cover up 300-400 cars and vehicles a day (16 hours duration), are now witnessing 600-800 cars a day. Because of low pressure, the capacity of compressor falls and the dispenser took time to fill CNG in cars especially in peak hours, he said adding “that is why people have to wait for over 15 minutes at the pumps.”
“We have never expected such a phenomenal demand in CNG. The gas demand will boost if petrol becomes more costly,” he said.
As many as 10,000 cars and other vehicles (with CNG fitted kits) are adding on the roads every month. This figure is enough to analyze the popularity of CNG. Pakistan is now considered as number one CNG-user country in the world.
To date, 821,000 vehicles have been converted into CNG while 685 stations all over the country are in operation. Over 230 stations are under construction, he said rejecting the figures of the Economic Survey 2004-2005 in which 700 stations were quoted. Investment of Rs17 billion has already been made in the CNG sector and Rs2 billion investment is expected in future. Moreover, the CNG industry has created 15,000 new jobs, the survey further added.
Punjab had the highest number of over 383 CNG stations followed by over 133 in Sindh, over 130 in NWFP and only one station in Balochistan. Cheap availability of smuggled petrol and diesel was blamed for low figure of Balochistan, he added.
He said that at least 2.5 crore is required to set up a brand new CNG station while efforts were underway to set up huge CNG stations equipped with dispensers for the filling of gas in public buses.
Replying to a query, the chairman CNG Dealers Association, Abdul Sami Khan said that red-tape at the federal government and local government and huge investment decelerated pace of setting up a station. “Sometimes documentation and processing of files in government departments take full year,” he said adding that an investor in the CNG station had to deal with numerous agencies before setting up a gas station.
Leading small car maker, Pak Suzuki is now rolling out 7,000 vehicles a month in which 50 per cent are CNG-fitted units. The share of CNG-fitted vehicles was 25 per cent in monthly production of 4,000-5,000 vehicles a year back.
Around 800-850 Cuore vehicles are produced every month in which the share of CNG-fitted vehicles is 50 per cent.
The share of CNG-fitted Dewan’s Hyundai Santro vehicles’ sales is also over 50 per cent out of its total monthly sales.
