U.S. consumers could be in the middle of a tug-of-war between two leading providers of passenger car motor oil over whether the intervals between oil changes will keep increasing to favor high-performance lubricants, according to a new study by Kline & Company.
For the foreseeable future, ExxonMobil and Shell will continue to vie for share in the PCMO market in the United States while pursuing opposing strategies regarding oil change intervals, according to COMPETITIVE INTELLIGENCE FOR THE GLOBAL LUBRICANTS INDUSTRY, 2004-2014.
Shell and ExxonMobil are among the leading marketers of finished lubricants in the United States. Shell owns the Quaker State, Pennzoil, and Shell brands, as well as the Jiffy Lube chain of quick-lube service centers. ExxonMobil is the world leader in premium basestocks and the top marketer of synthetic PCMO with its Mobil 1 brand. In addition, the company recently released a series of high-end lubricants that guarantee protection for up to 15,000 miles-more than three times as much as the current average drain interval.
Adding to the tension are the changing recommendations of automobile manufacturers. OEM recommendations for oil drain intervals have increased significantly in the last few years. While 3,000 miles was the suggested change interval not that long ago, most OEMs have now gone to a tiered approach, recommending oil changes at 7,500 miles under normal driving conditions and 3,000 for severe conditions. Kline's study puts the current average oil change interval in the U.S. at nearly 5,000 miles.
Oil monitoring systems that use an algorithm to indicate when an oil change is necessary are also becoming increasingly popular. They have been installed in BMWs and other high-end automobiles, and all GM models from 2006 forward will include such a system. Mercedes-Benz included an oil monitoring system on its vehicles through 2004 but has now gone to 13,000 miles as the drain interval recommendation, irrespective of driving styles and conditions. Jaguar is taking a similar approach.
With OEMs' increased drain interval recommendations and the introduction of longer-lasting oils, it might look as if ExxonMobil has the upper hand. However, it is consumer behavior that holds the balance.
"Even if new car owners go with the higher OEM recommendations, buyers of used vehicles may not strictly adhere to this trend," says Milind Phadke, senior consultant in the Petroleum & Energy practice for Kline's research division. "Frequent oil changes are generally seen by U.S. consumers as cheap insurance against more costly maintenance," he notes.
"There are two strong forces pulling consumers in different directions," says George Morvey, engagement manager for Kline's Petroleum & Energy consulting practice. "Environmental regulatory pressures will also influence whether the drain intervals increase, and so will the reaction of quick lubes, car dealerships, and other installed retailers to the recommendations and the new products."
COMPETITIVE INTELLIGENCE FOR THE GLOBAL LUBRICANTS INDUSTRY, 2004-2014, Kline's third edition of this study, is a comprehensive analysis designed to help strategic planners, marketers, and raw materials suppliers assess the markets for their lubricant products and understand their competitors on a regional and global basis. It examines 30 major and developing lubricant- consuming countries and suppliers.
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