LPG bowsers are disappearing from petrol stations across the country as customers and car manufacturers abandon the fuel that was to be the environmental and economical solution for powering cars.

For drivers whose cars run on LPG, it is likely getting harder to find a petrol station that stocks the fuel.

Petrol stations are decommissioning their LPG bowsers, and car manufacturers now favour hybrid or diesel as alternatives to petrol engines.

It is an enormous fall for the fuel that was once so popular, the former Howard government introduced a $2,000 rebate for customers to convert their petrol cars to LPG in 2006.

Back then, Wollongong mechanic and LPG conversion specialist Nick Joncevski's business boomed.

"We had been in business for four or five years and we were working late nights trying to keep up with the demand," he said.

"We were having trouble with suppliers supplying parts to us [due to demand], and business was fantastic back then — it picked up our business considerably."

Mr Joncevski said customers had often been forced to wait six months before they could book their car in, due to the overload of work.

Wind the clock forward 11 years and he has not done an LPG conversion in two years.

"I get a lot of enquiries about it, but the cost of conversions has gone up and demand on LPG has slowed down because the cost at the bowser has gone up as well," he said.

Service stations operate on supply and demand

Service Station Association spokesman Colin Long confirmed petrol stations were choosing to remove LPG bowsers due to falling sales.

"It's a product that's gone out of favour since the government subsidy [for LPG conversions] has now stopped," he said.

"Ford were producing an LPG Falcon which came onto the market and didn't take off, and now the big oil company sites are looking at what LPG is bringing to them in terms of sales, and a number have eliminated it as an offer on their forecourts."

Mr Long said some European countries were even looking at phasing out diesel in commuter cars as the focus turned towards developing battery powered cars.

"We represent mum and dad [petrol station] owners and if LPG isn't selling, they'll get rid of that and push petrol and E10," he said.

Recipe for the demise of LPG cars

A mechanic retro-fits an LPG system to a late model car in 2006. ( AAP: Dean Lewins )

There are a number of factors that have caused a decline in cars running on LPG.

There has been a rise in small car sales since 2006 when the LPG rebate scheme was introduced, and many of those smaller cars run on petrol, diesel, or are hybrid.

Australian car manufacturers Holden and Ford announced the end of manufacturing in Australia, and the price of LPG has increased.

The LPG rebate scheme was wound back to reduce the number of eligible claims per financial year before it was eventually scrapped.

"Back in the day you could almost run your fuel cost at half the cost of running it on petrol," Mr Joncevski said.

"Now you're almost at the same dollar value on your vehicle in running costs, so people weigh it up and think it's too hard to get their repairs done on LPG so they just run on petrol."

He said with the decline in LPG cars, spare parts had been harder to source and more expensive to buy, adding another negative to the prospect of running an LPG car.

Many service stations have removed LPG bowsers from their businesses as demand declines. ( ABC Illawarra: Justin Huntsdale )

Converting back to petrol

Mr Joncevski's Wollongong business was built on the back of LPG conversions, and now he finds himself decommissioning them and replacing them with petrol engines.

"We've had a few customers saying it's hard to find LPG in petrol stations, and petrol stations are looking at the viability of keeping LPG and having their tanks checked over every 10 years," he said.

"That comes at a great expense to them, so they're pulling them out of petrol stations at the moment."

But Mr Joncevski is experiencing a spike in LPG customers because the tanks have to be checked every 10 years, and customers who took advantage of the rebate when it was introduced are due for an inspection.