Domestic Lubricating Oil Brands Want to Capture High-End Market

The reporter learned on November 9, 2011 that Dongfeng GS lubricants, a lubricant brand jointly created by China Dongfeng Oil Group and the world’s top 500 company, South Korea’s GSCaltex Co., Ltd., were officially launched. This is Dongfeng Oil Group's second international co-brand after Meifeng Dongfeng, and it is also a major move for the accelerated transformation and upgrading of domestic oil products to seize the high-end lubricants market.

The development of the Chinese automotive industry has developed a huge treasure for automotive lubricants. For every 1 million cars sold, the demand for lubricants will increase by about 91,000 tons. It is expected that by 2020, China will replace the United States as the world's largest consumer of lubricants. However, in the high-end lube market, foreign brands have an advantage, and in the low-end market, most local private enterprises. Looking at the domestic market, "scattered, chaotic, and small" is the current status of the lubricant market. At present, there are thousands of lube oil producers across the country.

At present, the domestic market for lubricant oil has exceeded 100 billion yuan, of which high-end products account for 20% of the profits, and thus rise to the main battlefield of lubricants competition. Foreign brands such as Mobil, Shell, and Castrol have launched a new round of competition with local brands such as Great Wall Lubricants. Other local brands have only been “bystanders” for some time. In an interview with the media, an executive from an international lubricants company in China said: “In the next 10 years, China will fully enter the automobile era. Whoever wins the Chinese market will win the future of the global lubricant market.

Analysts pointed out that the future of the Chinese lubricants market, mergers and acquisitions is not new, and the rise of national brands, will be another aspect. First, the accelerated distribution of international brands such as Mobil, Shell, BP, Caltex; Second, the rapid expansion of the local brands such as the Great Wall, Kunlun, etc.; and the biggest oil companies in the country. In order to occupy more market shares, various lubrication brands rely on their own capital, technology, and brand advantages to join forces with downstream automotive and industrial companies to divide the market. Even if the “28 law” is the biggest obstacle to the growth of domestic brands, Who will give up on huge market profits? “China's lubricant industry is undergoing an evolution from a low-end to a mid-to-high-end upgrade.” Industry insiders pointed out that domestic lubricants companies represented by Dongfeng Oil Group have started strategic adjustments and upgraded their products.

In the face of blocking international brands, national brands have also resorted to killers. With the background of the Chinese lubricant industry being upgraded from low to medium-grade, domestic lubricant manufacturers represented by Dongfeng Oil Group have started to make strategic adjustments. Actively upgrade the product. According to Liang Bing, Executive Director of Dongfeng Oil Group, the birth of Dongfeng Oil Group's three-level five-star marketing model is the best evidence. No matter from the aspects of product quality, brand positioning, marketing ideas, companies are constantly exploring innovation, with internationalization as the goal, differentiation as a means to break the “28 law” and call Banyang brand.