Castrol first to move price in 2006. |
According to Jobbers World's sources, Castrol is the
first major to increase the price of its finished
lubricants in
2006. Taking effect on March 1, 2006,
Castrol will reportedly increase the price of all Castrol
GTX
PCEO by $0.28 a gallon on bulk and $0.36 a gallon on
packaged product. Its mid-tier PCEOs (including GTX
High Mileage, Startup, and Syntec Blend) will
reportedly increase $0.36 and $0.44 a gallon for bulk
and packaged, respectively. And according to
Jobbers Worlds sources, Castrol will bump the price
of its synthetic PCEO up by $0.64 a gallon for both
bulk and packaged product.
In addition to increasing the price of its consumer
automotive lubricants, Castrol reportedly will also
increase the price of its commercial and industrial
lubricants in March. Its conventional C&I lubricants
are reportedly moving up $0.28 a gallon, and its
synthetic C&I $0.48 a gallon.
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ExxonMobil is second to move...and an interesting move it is |
Within only one day of Castrol announcing an
increase in the price of its lubricants, ExxonMobil
followed with its price increase. According
to Jobbers World’s sources, effective March 1, ExMo
will increase the price of its conventional branded
and unbranded lubricants by an average of 8%. Its
synthetic lubricant prices are reportedly going up
4%.
Although ExMo's announcement would appear on face
value to be just another form letter about price
increases, it gets more interesting when one peels
another layer off the onion to look at some of the
detail. The first "that's interesting" starts with the
understanding that ExMo had previously informed its
marketers that Exxon Superfo will no longer be made
available to them in bulk. ExMo reportedly made a
decision to drop Superflo from its lineup at the first
of the year. This means that customers formerly
buying Superflo in bulk will now be switched over to
Mobil PCEO. For most this might sound like a good
deal if all things remain equal on pricing. But they
didn't. According to what Jobbers World is hearing,
ExMo is now offering it distributor’s two choices when
they buy Mobil PCEO.
The choices are to buy in Mobil with and
without "options." It short Jobbers World is
told, "with options" means the purchase includes
certain programs historically bundled with the
product. These programs are debundled from the
offering when the product is purchased by a
marketer without options. Now for the second "that's
interesting."
From what Jobbers World has heard on the street,
ExMo's price for Mobil PCEO with options will
increase by $0.15 a gallon as of March 1, 2006. The
price for the same product without options will be
bumped up by $0.40 a gallon.
This means ExMo is now making the value of the
options more visible and maybe more importantly, it's
increasing the price of the Mobil without options
replacement for bulk Superflo in such a way that
buying with the options appears to be a good deal
for marketers and buying without the options is a
good deal for ExMo's bottom line.
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SOPUS takes off the gloves... |
According to a number of industry sources, Shell Oil
Products recently restructured it lubricant price
schedule. Without mincing words, what Jobbers
World is hearing is that prices for Pennzoil and
Quaker State will likely be more competitive in 2006.
Similiar to ExMo's approach of offering a with and
without options choice, SOPUS has reportedly put a
value on some of the program options it typically
bundles with its lubricants. Although unconfirmed by
SOPUS, the company is reportedly now prepared to
back out some program costs in an effort to reduce
its sticker price and regain
some of the market share it reportedly lost over the
past few years.
Again, although unconfirmed by SOPUS, word on the
street is that Pennzoil and Quaker
State will be priced more competitively this year than
last. And if the street is right, we can expect to see
a leaner SOPUS who is willing and ready to fight for
share with prices that are $0.30 to $0.60 a
gallon more competitive this year than last. In fact,
some marketers say if SOPUS takes a pass on the
next
round of price increases the distance between
SOPUS and its competitors will be even greater.
SOPUS is reportedly in a position to make this move
due to its efforts over the past two years to
reduce costs. These efforts include improved supply
chain management,
SKU rationalization, elimination of selected direct
delivery operations, and other cost reduction efforts.
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Les Rudnick joins Ultrachem |
Ultrachem Inc. announced that Les Rudnick has been
appointed Technical Director. Les formerly a faculty
member at The Pennsylvania State University,
University Park, will be located at Ultrachem's facility
in New Castle, Delaware.
Les has over 20 years of industrial experience with
petroleum, lubricant and lubricant additive
companies. He has authored or edited over 85 journal
articles, book chapters and books, including
Synthetic Lubricants and High Performance
Functional Fluids, Second Edition, Lubricant
Additives: Chemistry and Applications, and the newly
published Synthetics, Mineral Oils and Bio-Based
Lubricants: Chemistry and Technology. Dr. Rudnick
also serves on the editorial board of the Journal of
Synthetic Lubrication.
Established in 1965, Ultrachem is one of the oldest
specialty lubricants compounders. Privately held
since 1984 by a group of key employees, Ultrachem
has built an impressive reputation as a supplier of the
OEM and industrial maintenance markets.
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