The business of taxis running on compressed natural gas (CNG) cannot develop well without proper government support, industry leaders say.
The government needs to have supportive programs like preferential import tax policies for CNG taxi businesses, supporting them in installing devices that can help make the switch from petrol- to gas-based operations, said Tran Viet Tuan, Vice Chairman of Vietnam Gas Association.
Other forms of support like land for gas companies to establish gas stations are also needed, Tuan in a recent interview with Thanh Nien.
“With the government’s help, cars using CNG would become common, making considerable contributions to reducing environmental pollution,” he said.
In fact, businesses are facing difficulties in investing in the business because a converter costs some VND20 million (US$1,082) and they have to pay the same import tax on the petrol cars that are going to be used as CNG vehicles, said Vuong Dung Hoang, Deputy Director of the Dong Duong Oil and Gas Transport Joint-stock Company.
They also face difficulties in applying for land to set up gas stations which have stricter licensing requirements than petrol stations, Hoang said.
Currently Hanoi has two gas stations, while around ten stations in total are operating in Ho Chi Minh City and the coastal southern town of Vung Tau.
It is estimated that less than 1,000 gas taxis are running nationwide, mainly in HCMC and Hanoi, since the first one was introduced on Vietnamese roads in 2004.
Studies show that CNG taxis are more economical than those that run on petrol, saving 28 percent of fuel, and are able to cut down much as 80 percent of the emissions, Tuan said.