Partnerships and collaborations with OEMs, vehicle insurers and other entities to drive the growth of the industry, as per a report by Ken Research
1.The Changing Environmental Norms and Callenges faced by the Lubricants Market- Focus on reducing CO2 Emission is a big Challenge.
- Paris Climate Agreement, Demand for reducing CO2 Emission, Focus on Green Planet has led to various changes in the Automotive and Industrial settings.
- The new private car sales declined from 6 Mn to 1.9 Mn from 2012-16 period. Similarly, the commercial vehicle sales has witnessed constant decline during 2014-16.
- New digital methods are disrupting the entire value chain for lubrications. Application linked data has led to change the product development to simulation based approach.
- Mobility trends are changing with new material used for production, changes in engine standards, fuel emissions and focus on e-mobility and new lubricants being demanded as per new specifications with new applications such as cooling, battery cooling.
2. Trends and Developments- Increasing Oil Production and Vehicles on Road is a Favorable Situation for the Market
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In 2016, Brazil overtook Venezuela to become the region’s biggest oil producer. In 2018, it produced about 140 Mn Tonnes of Oil. This has declined oil prices and increased consumption.
The GDP Growth, industrial production increase, auto vehicle production growth, low inflation and other factors increased the market.
The lubricants market in Brazil has witnessed various partnerships, acquisitions and mergers in recent years. In 2018, Iconic was formed from a JV of Chevron and Ipiranga.
3. Decision Making Parameters undertaken by consumers buying automotive lubricants.
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- The Purchase Decision is Highly Price Sensitive. Customer is willing to purchase high cost lubes for expensive vehicle. Low Price raises suspicion about the product quality in mind of customer.
- Customer purchases product recommended by mechanic or are well known due to the lack of technical knowledge. Companies such as Petrobras, Iconic, Cosan have some of the most famous manufacturers of lubricants in Brazil.
- Vehicle’s life and performance quality is affected by the quality of the lubricant, therefore consumers adopt for good quality product.
- Lubricants are widely available through car service stations, supermarket, hypermarket, distributors and online shops. Mechanics or personnel prefer products which are easily accessible to them.