"The CNG market in Thailand is growing rapidly due mainly to support from the government and rising oil prices," said Sammitr's president Chao Posirisuk.

Recently, the government said it would increase the number of CNG vehicles to 500,000 over the next five years. Meanwhile, PTT Plc said it would support the use of CNG vehicles by increasing its NGV gas stations from 63 to 200 this year and to 700 in five years.

Sammitr plans to penetrate the CNG market by producing CNG products for both automobile companies (original equipment manufacturing or OEM) and end users.

Although the company has tried to make products for other firms as OEM in Thailand, it is still in negotiations with the government on issues such as OEM standards and tariffs.

Chao said that Sammitr has retrofitted CNG engines in China for four years using the Chinese standard - which is equivalent to the European and American standards - but the government preferred the European standard.

At the same time, the government has offered support by decreasing the tariff on OEM products from 25 per cent to 20 per cent.

As a Euro IV diesel standard bearer in Thailand, Sammitr has also discussed with automobile manufacturers whether retrofitting CNG could be applied to their vehicles.

"Toyota Motors Thailand has visited our plant in China to exchange know-how on retrofitting CNG engines in Thailand," said Chao, adding that the company expects automobile manufacturers to guarantee its CNG engines.

Changchun Sammitr Motor Co Ltd, a subsidiary of Sammitr Motors Group in China, has retrofitted more than 30,000 Volkswagen Jetta diesel cars with CNG engines over the past three years.

Changchun Sammitr this month increased its production capacity for retrofitting from 800 to 1,120 vehicles per month. It also targets a 40-per-cent growth in sales this year due to the Chinese government's expansion of mega-projects and infrastructure projects in industrial zones.

Chalida Ekvitthayavechnukul

The Nation