Russias gear oil consumption will be driven primarily by passenger car sales, which are expected to grow by 44 percent overall by 2018, Nikita Medvedev, a senior analyst at RPI, said in an interview. As of January 1, 2013, Russias total vehicle park, including passenger cars, light commercial vehicles, trucks and buses, reached 44.7 million units. Passenger cars accounted for 83 percent of this number, while trucks and light commercial vehicles accounted for 8.2 percent and 8.4 percent, respectively. The share of buses didnt exceed one percent of the total vehicle fleet, Medvedev said.

Last years largest share of gear oil consumption came from passenger cars, at over one-half the total volume, while medium- and heavy-duty trucks accounted for 30 percent of the total.

In 2012, the countrys total automotive gear oil consumption reached 65,190 tons, according to RPI. Aftermarket sales of passenger car gear oils amounted to 29,500 tons that year, while factory fill amounted to 3,300 tons.

In the light commercial vehicle segment, this proportion was 7,000 tons for service-fill gear oils and 490 tons for factory fill, while in the truck segment it was 18,400 tons and 1,400 tons, respectively. In 2012, buses required 4,900 tons of gear oil for service fill and 200 tons for factory fill.

The study found that automatic transmission fluid demand will likely increase through 2018, while the consumption of manual transmission fluid should decline. This is due to the rising popularity of cars equipped with automatic transmissions, Medvedev explained.

In geographic terms, the Central, Volga and Siberian Federal Districts accounted for the largest share of gear oil demand in 2012, at 60 percent of the total. The Central district consumed 16,600 tons for a 25.5 percent share, Volga consumed 14,000 tons, or 21.5 percent, and Siberia used 8,800 tons (13.5 percent).

The high volume of consumption in these districts is a result of the large size of the population settled there as well as developed sectors of industry, trade and service, Medvedev said.

Russias varied regions do not use gear oil at the same rate. In 2012, the Far East Federal District led per-capita gear oil consumption with 0.7 tons per 1,000 inhabitants, followed by the Northwest Federal District (0.52 tons per 1,000 inhabitants) and the Volga Federal District (0.47 tons), according to RPI. Our forecast is that per-unit gear oil consumption will decrease gradually due to the renewal of the current fleet and replacement of obsolete vehicles with foreign car brands, Medvedev observed. Another factor that could constrain the scope of the countrys gear oil demand could be an increase in service interval mileage.

The consultancy also expects many new passenger car transmission production facilities to be set up in Russia between 2014 and 2018, which would drive the countrys rise in factory-fill oil consumption.

For more information about the 90-page RPI study, available in Russian and English, see http://rpi-research.com/publications/detail.php?ID=477