Sarlboro Plans Big Blend Plant in Tianjin


Chinese lubricant blender Sarlboro plans to construct a second factory in Tianjin, China, and is now in talks with the local government about the project.

The company, which is headquartered in Tianjin, currently has capacity to produce 50,000 tons per year of automotive and industrial lubricants and greases. The new facility, which costs about 130 million (U.S. $19.3 million) will be designed with a capacity of 250,000 t/y.

Our current capacity can no longer meet the demand, so we are in need of another facility, Li Yanguo, Sarlboro general manager, told Lube Report Asia. Construction is expected to start in the first half of 2017.

Sarlboro says it needs more production capacity to accommodate growing sales of its existing products, especially automotive lubes for compressed natural gas vehicles. To date, the company sees little competition among Chinese lube suppliers for such applications. Li explained that Sarlboro has a partnership with ENN Group, a Langfang, Hebei company focused on alternative energy development.

ENN has more than 1,000 CNG stations in the country, and the number is growing, Li said, adding that Sarlboro supplies mostly stations in Tianjin and nearby areas. We want to keep up with the supply.

The new plant would also enable Sarlboro to take on a big new supply contract and to expand geographically. Li said the company expects to land a deal to supply factory fill lubricants to Volkswagen, whose joint venture with Chinas First Automotive Works is building an assembly plant in Tianjin, which is scheduled to start production in 2018.

Li is also eyeing the west region of China.

The affluent east coast area will certainly be our focus, but we also want to gain more market share in Western China, an important part in Chinas development plan, Li said, referring to many supportive policies to boost the economy in western China, including building a regional innovation center in Chongqing and the One Belt, One Road policy encouraging development around Xinjiang, Shaanxi and Gansu – all major regions in the western part of the country.

With the additional capacity, Sarlboro will be in position to take other original equipment manufacturer contracts that could be up for grabs thanks to the government of Tianjin, which in recent years has been forcing out low-end manufacturing industries that generate pollution, such as steel, building materials and textile.

Because of this, many small lube factories have to move out with their clients or simply close the business. So we are here to replace them, Li said.

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