Motorcycle Lubes Poised to Grow


The two-wheeler industrys demand for lubricants is projected to increase globally at a rate of 6 percent from 2011 to 2016, Kline & Co. found, driven by growth in vehicle population and production, usage in commercial applications, and higher fuel prices.

Global demand for two-wheeler lubricants was 1.1 million tons in 2011, while the total two-wheeler population was almost 500 million units. According to Klines study, Lubricants for Motorcycles, Scooters and Mopeds: Global Market Analysis and Opportunities, the global population of two-wheelers is expected to exceed 700 million units by 2016, with Asia Pacific having the largest total population growth.

Three-wheelers and all-terrain vehicles were not included in the study, which includes traditional two-wheeler markets in South America (Brazil and Colombia), Europe (Italy), and Asia Pacific (India, Pakistan, Indonesia, Thailand, Vietnam, China, and Malaysia).

Overall, the two-wheeler lubricants market is expected to increase by 6 percent from 2011 to 2016. Asia Pacific, South America and rest of the world are expected to show from 6 to 8 percent two-wheeler lubricants growth, according to Milind Phadke, India-based director for Klines Energy Practice.

This lubricants consumption growth is driven by the growth of two-wheeler population and production growth in Asia, South America and Africa, he said during the March 26 webinar. Another reason for lubricants demand growth in the two-wheeler industry is the increase [in use] of two-wheelers as taxis and for goods transportation in South America.

Kline found that Europe is expected to see two-wheeler lubricant demand slump due to increases in drain intervals and usage of semi-synthetic and synthetic blend engine oils.

In 2011, Asia Pacific held around 80 percent of the total global two-wheeler population, around 90 percent of total global two-wheeler production, and around 75 percent of the global two-wheeler lubricants consumption, Phadke said. South America holds less than 10 percent of the two-wheeler global population, with similar share of its two-wheeler production, while the share of its global lubricant two-wheeler consumption in 2011 was around 15 percent.

Chinas two-wheeler sales are declining as a result of the saturated market, while sales in India and Indonesia are increasing, Kline found. The decrease of two-wheeler sales in China has been taking place since 2009 due to the restriction on movement of two-wheelers in big cities and on highways. The traditional markets of India, Indonesia, Vietnam and Pakistan, as well as Brazil, have all seen growth from 5 percent (Brazil, Malaysia, Colombia) to 15 percent (Pakistan) from 2007 to 2011, Phadke said, adding that Thailand is an exception because of the halt on production of two-stroke engines there.

Most European countries markets exhibit a declining trend in motorcycle sales, according to the Parsippany, N.J.-based consultancy.

In 2011, global lubricant demand in the two-wheeler category amounted to 1.1 million tons. Up to a 95 percent share of this demand was held by engine oil, and the rest goes to fork/suspension oil and grease, Phadke said, adding that to lubricate their motorcycles chains, Americans and Europeans use chain lubricants and greases, while some regions, such as India, use recycled oil.

By engine oil type, four-stroke engine oil held around 80 percent of the total two-wheeler global demand while the rest goes to two-stroke engine oil, according to Kline. The study found that 20W-40 and 20W-50 are the leading engine oil grades in Asia Pacific, South America and Africa, while the Chinese market is more skewed toward 15Ws. Leading viscosity grades in Europe are 10Ws and 5Ws, because of the higher penetration of semi-synthetic and synthetic blends. Increase in the penetration of 10W-30 and 10W-40 is due to OEM recommendations such as [those of] Honda, Phadke said.

Asia Pacific leads in two-wheeler lubricants for factory-fill. Two-wheeler manufacturing in Asia is driven by both domestic and export demand. China accounts for 41 percent of the global two-wheeler production and its exports account for approximately half of the total production, while strong domestic demand is encouraging manufacturing activity in India, Indonesia and Brazil.

The study also found that synthetic and semi-synthetic product penetration in 2011 was highest in the mature markets of Europe and North America, and that this product category is increasing globally. Synthetic products penetration in Asia Pacific and South America is linked to sales of high-end motorcycles, Phadke said, adding that such markets in these regions are growing rapidly and are expected to increase in the future.

Top-10 suppliers account for 48 percent of the global two-wheeler lubricant market. It is a very fragmented market. National oil companies and regional suppliers cover around 20 percent of the supply. Key two-wheeler lube suppliers include Castrol, Shell, Idemitsu, Pertamina, Chevron and Total. Asia Pacific is a very fragmented market among all other markets, with regional and local low-quality suppliers threatening the market share of global players.

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