The aim is to assure that motor oils are labeled correctly and deliver the quality promised by the API donut and starburst logos. In 1999 the program expanded to take samples and test oil from bulk tanks, such as those at repair shops, quick lubes and other motor oil installers. With the kick-off this month of Motor Oil Matters, API closes what it believes is an open area of accountability in the engine oil market. MOM is a new voluntary licensing program for engine oil distributors and installers which aims to certify a secure chain of custody from the manufacturer to distributor to installer to end-user. Together with EOLCS and other programs, API believes it now has a full bulwark against purveyors of off-spec, mislabeled or fraudulent engine oil.

Supporting these quality initiatives is a proposed action by the National Conference on Weights and Measures. On NCWMs agenda at this months national meeting is a proposed rule that calls for, among other requirements, the inclusion of the products brand name on all oil-change customer receipts and invoices.

North Carolinas Stephen Benjamin, chairman-elect of NCWM and a vocal advocate for this rule, believes that it will pass and be adopted by regulators around the country. Benjamin heads the standards division in North Carolinas Department of Agriculture, which samples and tests motor oils sold within the state.

Kevin Ferrick, APIs manager of global industry services, was emphatic in his support of the NCWM action. Assuming that this rule is approved its a great step forward in ensuring motor oil customers are getting the high-quality motor oil theyve come to know and trust, he told LubesnGreases. Also, the National Institute of Standards & Technologies is expected to write the rule into the next edition of its Handbook 130, which many regulators use as a guidebook.

Getting Under Way

MOM began under Shell Oil in 2009 as an effort to educate the public and ensure the chain of custody, and originally involved the companys lubricant distributors and installers, such as its Jiffy Lube stores. API also saw the need to do more to promote the use of API-licensed oils, and recognized the value of Shells program. Last year Shell transferred the program to API so that all distributors and installers, not just Shells, could take part in the program. API has expanded and updated the program, so Shells original participants now must sign on to MOM under API.

API publication 1525A, Bulk Engine Oil Chain of Custody and Quality Documentation, is the document defining the program requirements. The public faces of MOM are three legal marks. One identifies the MOM program, another identifies licensed organizations that distribute bulk engine oil, and the third identifies licensed installers. These marks can be displayed by a licensee after successful completion of the application process, payment of the fee and ongoing compliance with the program.

API believes MOM will make a difference, and that distributors and installers have a strong incentive to participate. Licensees will be identified and promoted on API sites and other media, installers and consumers will become aware of the importance of API-quality motor oil and will seek them out, and quality will be safeguarded by a secure chain of custody. By more aggressively monitoring product quality, MOM will help level the playing field and curtail deceptive trade practices, API states.

Linkages between APIs MOM and its long-running engine oil licensing program will streamline the process serving both API and licensees. Distributors will be able to link back to the EOLCS Directory of Licensees when adding a product to their own directory listings. And samples used for monitoring MOM will be included in any aftermarket reporting under EOLCS.

More Rules

Under MOM, a distributor is defined as the entity that stores and delivers to multiple users finished engine oil obtained from another source or from a qualified in-house blending operation. An installer is the entity that puts engine oil into the engine of a consumer, the end user – a quick lube, garage or tire outlet, for example.

Is MOM another onerous paper/digital intrusion? API doesnt think so, Ferrick said. We dont believe the licensing process will require much more than distributors and installers are already doing.

However, he added, some installers may have to add product information, such as the brand, viscosity grade and API service level to customer invoices.

But Pat Wirth sees it differently. Owner of an Xpress Lube outlet in Fairfax Station, Va., Wirth is president of the Automotive Oil Change Association, a trade association with 1,200 members that represents almost 4,000 fast-lube facilities, or 20 percent of U.S. quick lubes. Most of these members, like herself, are small-business owners.

Aside from the paper/digital component of the licensing process there are requirements that MOM imposes beyond what installers are already doing, Wirth observed. The most obvious example is that operators are not in the business of taking and storing oil samples. Thats a major requirement. Our members have neither appropriate facilities for such storage nor the chain-of-custody level of training.

While Ferrick said that MOM procedures wouldnt change the operational practices of most distributors and installers, Wirth worries about maintaining documentation, the paper trail. Even when a digital trail is used, she says, care must be taken to ensure requirements dont become too onerous, since fast lubes generally dont have dedicated administrative support staff. Size matters, and most fast lubes are small operations.

Tests and Enforcement

The licensing process for both the distributor and installer relies heavily on the structure and outlook of EOLCS – submit an application, pay the fee and adhere to the terms of the license agreement. Both programs require participants to complete a self-assessment questionnaire. Records (paper or electronic) must be maintained for a minimum of six months. And product samples (8 ounces for installers; 4 ounces for distributors) are to be secured in a physical environment that will prevent deterioration and contamination.

The program reaches back to marketers and blenders that supply product. Theyre required to run seven physical and chemical (P&C) tests on each delivered batch of motor oil, maintain records and retains for six months, and establish a documented tracking system.

Distributors and installers are subject to scheduled and random P&C aftermarket conformance audits at each location, with distributors facing additional program audits. P&C properties of engine oil from bulk tanks are compared against licensing data on file at API and established performance requirements. The sampling process for installers will be the one currently used for APIs Aftermarket Audit Program, where samples are taken from bulk tanks for testing.

API has established three violation categories: noncompliance with chain-of-custody requirements, failure of an audited sample to meet published specifications and filed licensee data, and improper usage of the licensed MOM marks. Enforcement action, primarily directed to restricting or removing the Licensees ability to display the marks, will be related to the severity of the offense and the licensees approach to correcting the violation.

An advisory board of oil marketers, distributors and at times installers have provided developmental advice to API and will continue to provide oversight; operating procedures are being developed. APIs Lubricants Group, the committee of members who oversee its motor oil programs, provides oversight and advice on all industry lubricants matters.

Paying for MOM

API charges a flat royalty fee plus a volume-of-sales fee to license motor oil under EOLCS. The annual fees, which went up on Jan. 1, are $2,500 per license for API member companies and $3,000 for nonmembers. Licensees also pay $0.0030 per gallon of motor oil sold after the first million gallons.

At this writing, API had not settled on the fee structure for MOM, but Ferrick said there will be a flat fee but not a volume-of-sales fee.

One sticking point on finalizing the fee structure revolves around participants with multiple locations. A quick lube, for example, may be a stand-alone business, or a regional chain with just a few locations, or a national operation with hundreds of stores and franchisees. Pat Wirth expressed concern over the fee structure, and asked, How much will the fee be? Is it a one-time payment or an annual requirement? Has API considered a tiered structure to reflect the difference between oil company-owned facilities and independent facilities?

Ferrick acknowledged the cost issue, saying, Its a balancing act. How much do we need to fund the program, and how much is fair for installers with multiple locations? Were looking at a tiered system for both installers and distributors that will satisfy both sides.

Of course, fees are always a licensing program concern. But AOCA has larger issues which it spelled out in detail in a letter to API in early May. The relevance of the program, of APIs name recognition and the programs values were high on its members minds.

The fact remains that the vast majority of consumers dont know or care about an oil being API-approved, and that this program is going to be meaningless to the consumer, Wirth said. We asked API what the budget was going to be to advertise and promote the program, and got no response. She noted that the dairy industrys Got Milk advertising campaign cost $60 million initially.

In its comments to API, AOCA noted that it already recommends that its fast-lube members order bulk product in writing and obtain a written receipt verifying that the product they ordered was the one delivered and must include most of the 1525A requirements, including API-license status.

AOCA also expressed skepticism towards APIs approach on engine oil quality monitoring. Does API actually test the motor oil associated with every application for API certification? If so, adding a reference to API-license status could have a positive, substantive impact at the install level. If not, adding that reference seems like a technicality designed to support APIs brand without any particular value to the installer or end user.

AOCA insisted that fast-lube operators must maintain control over their operations. For example, APIs 1525A requires installers to confirm descriptive details of the product prior to delivery. But how, Wirth asked, can that be done when the distributor has total control of the information?

MOM is envisioned to be voluntary, she continued. But in practice, NCWMs involvement could make participation mandatory, and thus a significant revenue stream for API and a significant cost to installers, Wirth added.

AOCAs position has always been that automotive service providers install fluids that meet OEM requirements. We do not feel that this needs to be regulated by state governmental agencies.