The Government is currently reviewing its support for LPG, including the fuel duty discounts which make LPG half the price of petrol and diesel, while its limited support for grants towards purchasing clean-fuel vehicles has also raised concerns.
Thales UK, which operates in the defence, aerospace and IT sectors, has 360 vehicles running on LPG and a large number of petrol and diesel vehicles are due for replacement in 2005.
Fleet manager Nigel Rowden says the company's policy will see ever more vehicles converted in the future as existing models are replaced. He said: 'Naturally we aim to improve our environmental contribution across the business and given the size of our vehicle fleet, cleaner fuel was a natural choice in addition to the cost savings.'
Rowden called on the Government to extend the duty differential currently enjoyed by LPG against diesel and petrol, adding: 'Even if the duty increases slightly, LPG still makes economic sense for us, as most of our fuel usage is through our 'back to base' re-fuelling tanks. We will be watching the pre-Budget statement with interest.
'We, like many in the sector, have invested hugely in cleaner fuel vehicles and we want to see Government firmly committed to LPG, including funding of the Powershift scheme to meet increasing demand from fleets seeking to adopt LPG vehicles.
Rowden said fleet decision- makers require commitment from both Government and vehicle manufacturers.
He said: 'LPG is not the last word in alternative fuels but it has an important position in achieving low emissions and cleaner air quality today.'
Other firms more sceptical
Other fleets are less optimistic about the future for LPG
Dave McCabe, finance director at Walter-Broadley Machines, said: 'The only way LPG can continue is if it remains heavily subsidised.
When you take into account the additional capital cost pre-PowerShift grant, and the relatively poor fuel economy, diesel is a far more viable alternative unless the current situation is maintained. We need a long-term price guarantee.'
IBM fleet manager Phil Redman agreed and believes subsidies are needed for the LPG market to continue: 'The subsidies and manufacturer fitment of LPG has helped allay the fear on future availability of the fuel and residual values. Take this incentive away and the market will quickly fold,' he said.
Peter Connah, spokesman at Lancaster Partners said: 'Installation safety is an issue, as is loss of boot space and the fact they are not allowed on the Channel Tunnel. They have a high list price meaning drivers pay more tax and there is uncertainty over residual values and Government assistance.'
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