U.S. Aftermarket Motor Oil Sales Grow

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Motor oil sales at U.S. automotive aftermarket chains grew 1.7 percent to $2.6 billion in 2015, boosted by trends such as an aging car population and consumers switching to more premium products, according to NPD Groups Retail Tracking Service.

Passenger car motor oil, the largest motor oil subcategory tracked under the motor oil category, also grew 1.7 percent in dollars but was flat in quart volume, Nathan Shipley, director and automotive aftermarket industry analyst for NPD Group, told Lube Report.

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Shipley noted that premium motor oil – high mileage and full synthetic – grew 10.7 percent in dollar volume in 2015, while conventional motor oil declined 7.1 percent. There are several factors influencing this trend, including an aging car population and consumers shifting to more premium products to keep aging cars on the road longer, he said. Additionally, many newer cars call for full synthetic motor oil and/or oil weights that are only offered as a full synthetic product.

Consumers extending oil drain intervals is also likely impacting the trends in motor oil sales in the automotive aftermarket, he said, with consumers reporting longer drain intervals through NPDs consumer survey data. There is a lot of noise in the marketplace for consumers about what, exactly, is the proper oil change drain interval, Shipley said. Vehicle manufacturer recommendations, intervals printed on the front of oil bottles on shelf at retail, recommendations from mechanics or quick lubes, etc., all seem to give differing recommendations on what the proper drain interval for cars should be.

NPD collects point-of-sale information on a weekly basis from more than 26,000 individual retail stores in the United States.

The automotive aftermarket industry grew to $14.6 billion in 2015, with dollar sales increasing by 3.9 percent and units/quarts by 1.7 percent.

While dollar sales have accelerated since 2013, unit/quart sales have been down, and NPD noted that 2015 marked the first year in which both ended positively. Factors influencing the aftermarkets strong performance during the year included increases in new and used car sales, an increase in miles driven and atypical weather.

While new car sales in the U.S. hit a record in 2015 with 17.5 million sold, the huge number of used cars sold – 40 million – was the key factor in growth across the top-grossing aftermarket categories. Many new cars return to the dealership for service, which is not necessarily advantageous for the aftermarket industry, Shipley said in a news release. Used or aging cars, however, create maintenance behavior and need for products in this space. We believe theres an opportunity for the aftermarket industry almost immediately after purchase to talk to those consumers about what types of maintenance products need to be done on their recently purchased used car.

U.S. automotive aftermarket retail sales will reach $15.1 billion in 2016, NPD forecasts, up 2.7 percent from 2015. Tying in with that, NPD estimates that miles driven will return to a more modest growth of 1.9 percent.

Historically, the heaviest weighted driver in NPDs aftermarket forecast was miles driven, but in 2016 I dont expect that miles driven will continue to grow quite as robust as it has been for the last eight quarters, said Shipley. While I expect to stay positive, the growth will level off. With that, retail price becomes a much more important factor in this years forecast. Pricing drove a lot of what we saw in terms of change in 2015, and will be an influential driver in 2016. Macroeconomic trends, including unemployment and household income, will play into how much consumers are willing to pay for their vehicles and related products.

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