Will GM and the independent lubricant manufacturers be the big Winners?

  JobbersWorld conducted an online survey last week asking our readers about their thoughts and opinions concerning dexos1™. Understanding the survey was open for one week, the response was very good. We received 202 fully completed surveys and many partials.

  One of the more striking findings of the survey is that 69% of the respondents feel dexos1™ will have no impact on the quality of lubricants in the marketplace. Only 28% believe it will improve quality.

Another interesting finding is that where the majority of respondents feel General Motors (GM) has the most to gain from dexos1™, they believe independent lubricant manufacturers and fast lubes have the least to gain. But in JobbersWorld's view, although this may prove true for fast lubes, independent lubricant manufactures may actually enjoy significant benefits from dexos1™. And the reason they could is because all but two of the majors (Shell and ExxonMobil) have said they will not offer a licensed dexos1™ engine oil. At the same time, Cam2, Advanced Lubrication Specialties (ALS), Pinnacle Oil, and Allegheny Petroleum say they will offer dexos1™ licensed engine oil. Assuming others follow these independent dexos1 license leaders, the independent lubricant manufactures could be in a position to "claim" they achieve a "quality" level that exceeds that of most of the majors. Should this be the case, by luck or design, GM may just pull this off by pulling the rest of the majors into the world of licensed dexos1™ engine oil.

At the same time, if the only thing dexos1™ does is increase the cost and price of engine oil (especially during this down economy), you can be sure many independents will be jumping ship after their first or second year on board with dexos1™ licensed engine oil.   To understand why one needs to look at how the licensing fees ramp up over time. Whereas it is relatively inexpensive for an independent to offer a licensed dexos1™ engine oil in year 1 (about $7,500), and year two is even less expensive, the cost ramps up quickly from there. In fact, by 2014, they could be looking at a cost of close to $25,000 to license a dexos1™ (see Figure 1 below)

Although the licensing fees for majors are not shown in Figure 1, they are much higher and also ramp up sharply each year. In addition, when majors make a decision about licensing, it's often a long-term commitment. For these reasons, it's understandable why most of the US majors have said no to dexos1™. And if more majors don't get on board, GM may be challenged to keep the dexos1™ boat afloat.

NOW TO THE JOBBERS WORLD dexos1™ SURVEY...

Click for a PDF copy of the survey

  The following is a summery of the data derived from 202 fully completed questionnaires.

  Question #1

  Click here for "other" to Question 1

  Question #2

     Click here for comments for Question #2

  Question #3

  Click here for "other" responses to Question #3

  Question #4

*The Rating Score is the weighted average calculated by dividing the sum of all weighted ratings by the number of total responses.

  Question #5

  Question #6

  Question #7

  Comment Section

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