During an Oct. 7 webinar, Sushmita Dutta, a project manager in the firm’s energy practice, predicted that demand for oils used in motorcycles, scooters and mopeds demand will slip to as low as 1.3 million tons in 2020 due to the COVID-19 pandemic’s impacts. For 2020, she said, “the degree of decrease in different countries will depend on how severely the pandemic affected the economy, the duration of lockdown and the kind of services that were considered non-essential during period of lockdown.” She added, though, that demand should recover in 2021.

The study covered factory and service fill lubricants used in two-wheelers, and excluded lubes used in three-wheelers, all-terrain vehicles and snowmobiles.

Dutta noted that of the 15 major two-wheeler market countries, eight are in the Asia-Pacific region. Kline projects that the global two-wheeler population will grow from about 700 million units in 2019 to 800 million in 2024. The top markets in terms of two-wheeler population included India, Indonesia, China, Vietnam, Thailand, Pakistan, and the Philippines.

India also had the largest share of the global motorcycle oils market in 2019, followed by Indonesia, China, Brazil, Thailand, Vietnam, the Philippines, Pakistan, Columbia, the United States, Mexico and Malaysia.

Ninety-five percent of the engine oils used in two-wheelers are four-strike engine oils, she said. Other types of lubricants used in two-wheelers include fork oil suspension oil, greases, chain oil and gear oil.

With the highest two-wheeler population, Asia-Pacific also sported the highest factory-fill demand, at about 45,000 to 50,000 tons in 2019. “That is because two wheelers manufactured in Asia are not only manufactured for domestic market but for export market as well,” Dutta said. “Because of higher production happening in this region, the share of factory fill is also higher.”

She said that while synthetic motorcycle oils – including synthetic and semi-synthetic – have a higher share in Europe than in other regions, accounting for nearly 80% of demand in 2019, Asia-Pacific was the largest consumer of synthetics last year. “Even with a share of about one-quarter total engine oil demand, synthetics in Asia are significantly higher [in demand volume] than in any other region,” she added.

Dutta said heavier 20W weight motorcycle oils will continue to lead the global market over the next five years. She noted that 10Ws have significantly penetrated the four-stroke market in key countries, and over the next five years, the share of 10Ws in the four-stroke market is expected to grow at a faster rate, compared to heavier viscosity grades. Although 5W motorcycle oils are making some inroads in certain markets, they are not used much in Asian countries, she noted.

The motorcycle oils market is highly fragment, Dutta noted, with a large number of smaller suppliers accounting for about half of global demand in 2019. “The leading suppliers don’t have a very large share in this overall market,” she said.

“BP is the leading supplier because it is present in most of the [motorcycle oils] consuming countries, and it is the largest supplier in India, the largest market,” Dutta noted. Similarly, she said, Shell has a presence as motorcycle oils supplier in many markets. “Both these companies focus on innovative products, marketing and offer from time to time promotions to their customers and invest in advertising. All these activities make these companies the two leading suppliers to this market.”

Motorcycle manufacturer Honda sells lubricants under its own brand name, offered as a genuine oil. The company is one of the top five suppliers due to its leading position in Indonesia, Kline found. “It has a respectable share in India, as well as in Thailand,” she added.

Another notable supplier in Asia-Pacific is Hindustan Petroleum, the second largest motorcycle oils supplier in India. She noted it only sells the products within India.

Strong motorcycle oils suppliers in Indonesia include PT Federal Karyatama and Pertamina. ExxonMobil purchased Federal Karyatama in 2018, including the Federal Oil brand of lubricants.  “These companies have high shares in their respective markets, and Indonesia is the second largest [motorcycle oils] market, which makes these two companies important suppliers,” she said. Dutta noted Chevron is another multinational oil company whose motorcycle oils are popular in Southeast Asia. “Its lubricants have been sold in Thailand, Vietnam, the Philippines, Pakistan and Malaysia,” she added.