Kline & Company sees great opportunities for foreign lubricant producers in China
According to a report published by the international consulting and research firm, Kline & Company, there are great opportunities for multinational lubricant producers in China because of the increasing presence of global OEMs in the country.
The report, which was published late last year, focused on the US$18.7 billion lubricant market in China. Entitled “Opportunities in Lubricants 2011: China Market Analysis,” the report touched upon the various aspects of China’s changing market geographies and emphasized the need for dual strategies. With 2010 as the base year, the report expounded on the opportunities and challenges presented by the realignment of China’s economy from an export/manufacturing-driven economy to a domestic consumption-driven economy.
Although China’s state-owned oil companies dominated the market, the combined sales of foreign lubricant suppliers was about 27% of the total volume of lubricant sales.
Furthermore, the Kline report noted that China’s car population is expected to grow from 18% to 22% annually from 2010 to 2015, and since most of the big car producers in the country are joint venture companies, multinational lubricant producers are likely to fare better because of their proven standardized product performance and their value-added relationships.
“It is expected that this will lead to a rapid growth in demand for high-end lubricants in this market segment, with equipment manufacturers stipulating standardized, tested and trusted fluids,” said Geeta Agashe, vice president of Kline’s Energy Practice.
“This is an opportunity for global majors, such as ExxonMobil, Shell and BP, who have a strong relationship with the OEMs of imported equipment.” (February 3, 2012)