This contraction in demand is to a great extent underpinned by broad usage of the natural-gas-based motor fuel. According to the Chinese Association of Car Manufacturers, at the end of the first five months of 2024, the sales of heavy trucks operating on liquified natural gas (LNG) grew by 127% YoY (up to 92,562 trucks), and their share in the tow-trucks sales grew from 10.1% up to 21.4%. According to S&P Global Platts, the share of tow-trucks operating on LNG in the overall truck fleet in PRC will grow from 7.5% at the end of 2023 up to 10% at the end of 2024, and one of the contributing factors is minimisation of fuel costs: due to the difference in LNG and diesel prices this shift to LNG provides for USD 6,700 saving per annum given the annual run of 200 K km (estimate by Platts).
The shift to LNG in freight vehicles segment is associated with another factor, in particular, with relatively low usage of electrically propelled vehicles in surface commercial traffic. According to IEA, in 2023, in the global sales of vans the share of e-vehicles made 4.4%, but in the sales of trucks – only 0.9%. At the same time, the share of e-vehicles in the global fleet of vans and trucks at the end of the last year was 0.9% and 0.4% respectively.
Passenger transport is characterized by a higher prevalence of electric traction. In 2023, sales of passenger electric vehicles and plug-in hybrids in China grew by 37% (to 8.1 million units), and their share of passenger car sales increased from 29% to 38%. The share of electric vehicles in global passenger car sales at the end of last year was 18%.
