Motorists rush for LPG switch

Hundreds of car-owners are queuing at auto mechanics' shops specialising in retrofitting liquefied-petroleum-gas (LPG) tanks in a bid to reduce their fuel bills as oil prices continue their relentless climb.

However, the stampede for conversion comes as both the government and PTT - the country's sole importer of LPG - are warning that the increasing rate of conversion must be discouraged. The change to LPG is based on a hugely subsidised price that makes it irresistible in the light of skyrocketing petrol prices but which seems set to rise substantially in July.

Atchari Keanprasert, owner of Gas in Car in Bangkok's Nawamin area, said her garage had 480 cars in an LPG-conversion queue that stretches to July 27.

"The number of customers over the past three years has been overwhelming," she said, adding that the shop had been forced to open seven days a week in a bid to speed up customer service.

Aphichart Somdej, owner of Chor Auto Service, a centre for retrofitting LPG tanks in Nonthaburi, said his garage had 125 cars in its queue, and about 90 per cent of them required a sequential direct-injection system. About 70 per cent of the cars being retrofitted at his shop had small engines in the 1,500-1,800cc range.

Jumras Hadsadam, owner of Army Service Garage in Lat Phrao, said his shop had 160 vehicles to retrofit between now and June 20. Although his garage has the capacity to retrofit tanks on seven cars a day, the demand has been overwhelming, forcing it to open six days a week.

"This month alone, the garage has retrofitted 200 cars with LPG tanks, compared with 150 cars in the same month last year," Jumras said.

The rush to convert to LPG comes as world crude oil prices reach a new record of US$135 (Bt4,300) per barrel. At present, 95-octane petrol costs nearly Bt40 a litre. LPG, by comparison, now costs Bt11 a litre.

Jumras said the costs of retrofitting to LPG were Bt32,000 a car for a sequential direct-injection system and Bt15,000 for a variable mixer system. However, the costs of fitting tanks for natural gas for vehicles (NGV) are Bt58,000 and Bt48,000 for the respective systems.

Nearly all of the orders to Jumras's garage are for LPG retrofits, as few car-owners are interested in NGV, because there are too few filling stations despite NGV costing only Bt8.50 a kilogram.

"Don't talk to me about NGV," Jumras said. "I've retrofitted only two NGV tanks this year."

This despite the fact that PTT provides a Bt10,000 subsidy for retrofitting NGV tanks. He said the inconvenience of having too few filling stations was not the only problem with NGV. Queues at filling stations often mean a 30-minute wait for a fill-up, and the tanks for NGV are also much heavier than those for LPG while having a smaller capacity.

As well, PTT information said NGV delivered a speed rate 16-per-cent below that of petrol, Jumras said.

PTT president Prasert Bunsumpun recently said LPG for motorists had to be more expensive, in order to discourage people from shifting to the gas.

The government is planning to impose a two-tier price system for household and transport users of LPG in July, and there is concern a new price for LPG in cars that is too low will fail to halt the rush to convert, because oil prices will continue to rise.

The domestic price for LPG is capped at $300 a tonne, while PTT pays nearly $900 a tonne for the fuel on the world market. Domestic refiners are reducing their supplies of LPG, because of the government's subsidised prices for the gas, and PTT is now forced to import it.

PTT is expecting the government to compensate it for the difference between the import and the domestic prices once the new two-tier system is implemented.