Give or take some obscure products formulated for use in nitromethane burning funny cars and dragsters, there are currently 24 viscosity grades of motor oils in the market. They include five straight grades and a wide range of multiviscosity motor oils running the gamut from SAE 0W-5 up to 20W-60. There will be even when SAE 0W-16 and 5W-16 enter the market, trailed someday by the budding XW-8 and XW-12 grades.
That makes for a lot of SKUs and leaves little room on retail shelves and in distributors warehouses for motor oil grades that dont sell.
So whats selling and whats not, and what types and grades of motor oils might be sent out to pasture? For answers, start with a look at retail shelf space.
Lined up shoulder-to-shoulder, one facing of quart bottles in each grade of motor oil currently in the market would account for nine feet of linear shelf space. To fully showcase four brands and three product tiers (conventional, high-mileage, synthetic), retailers need more than 80 feet of shelf space – close to four gondolas to stock just one facing of each.
To present four facings of each, which isnt much, that number bumps up to 16 gondolas, or 64 running feet of floor space for passenger car motor oil – and that doesnt take into account duplicating the same in 5-quart jugs. Making room for the jugs adds another 155 feet of shelf space.
Needless to say, its unreasonable to expect a retailer to allocate that much space to motor oils, especially when bananas are the hottest-selling products at Walmart and oxygen sensors lead in sales at most auto parts stores. Although motor oils move, there is no room on the shelves for types, brands and grades that dont.
Lubricant marketers face the same realities. If a product sells, they have it in bulk and drums. If its a slow mover, its available only in cases. And if it doesnt move, its probably best to Google the viscosity grade and buy it online from a specialty lubricant marketer.
Shrewd retailers and lubricant distributors regularly comb through the mix of viscosities, brands and types of PCMO they carry, winnowing out the chaff. As the array of offerings increases, and demand shrinks for some types, something has to go. But what?
One sure thing, at least in the near term, is that SAE 5W-30 will continue to enjoy space on retail shelves and in distributors warehouses. This is the leading grade in the U.S. market, accounting for an estimated 52 percent of total PCMO demand. Another safe bet is that 5W-20 will stick around for a while, since it currently holds an estimated 23 percent of the total.
But beyond these two, there are questions about the future of other grades due to their relatively limited demand. Next in line is SAE 10W-30, at close to 12 percent of demand and shrinking. Its followed by 0W-20 (growing) and 10W-40 at roughly 4 percent each, and from there, the market splinters into 20W-50 and various other grades that account for the balance of demand.
So whats going to go?
According to some leading lubricant marketers, SAE 10W-40 is on the chopping block, if not already out the door. Many view demand for this grade as too soft to inventory. Although marketers will buy and sell 10W-40 if requested, its no longer a viscosity grade that many will carry in cases, let alone bulk and drums. Instead, its a grade they provide on an as-needed basis. Its also becoming harder to find on retail shelves.
And now for the real eye openers.
Whereas it seems like only yesterday that SAE 10W-30 was the PCMO workhorse, today it accounts for only about 12 percent of the total and demand for it continues to slide. The writing on the wall says the days of 10W-30 are numbered. Although most retailers and distributors still sell it, a growing number say they are not giving price concessions on 10W-30. Instead, they are encouraging buyers to migrate to 5W-30 in an effort to reduce both the marketers and the customers costs.
Next consider the up-and-coming lightweights: the SAE 5W-16s and 0W-16s looking for space and a place in the market. While there is forward-looking demand for 0W-16, many question if any space is needed for 5W-16. Although some original equipment manufacturers have been vocal about wanting 0W-16, barely a whisper is heard about the need for 5W-16. Adding to this, as yet there is no viscosity grade read-across from 0W-16 to 5W-16 to assist blenders, and questions remain about who will write the big checks to run programs for it. No wonder some suspect 5W-16 may be kicked to the curb before it even makes a dent in the market.
What about the old heavyweight champions? Chances are SAE 10W-30 will soon drain out of bulk tanks and slide on down to drums, cases and eventually out the door. Further, where 10W-40 is already very hard to find in bulk, it will soon be hard to buy in drums and cases, and mostly will be marketed online and by special order. And although you can still find a bottle or two of 20W-50 on retail shelves, it too will soon be off the gondolas and on to the online specialist.
So who is going to go?
Thats anyones guess. But in addition to the evolution that brings in the new and rings out the old in viscosity grades, you can be sure that retailers and marketers are questioning the very brands and tiers they carry. How they answer these questions will be a defining moment for major brands, private-label, conventional, synthetic blends, high-mileage motor oils and others. Because at the end of the day, retailers and lubricant distributors sell what sells. z
Tom Glenn is president of theconsulting firm Petroleum Trends International, the Petroleum Quality Institute of America, and Jobbers World newsletter. Phone: (732) 494-0405. E-mail: tom_glenn@petroleumtrends.com