Finished Lubricants

Critical Trends Impacting the Asia-Pacific Lubricants Market


Critical Trends Impacting the Asia-Pacific Lubricants Market
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Increasingly stringent emissions and fuel economy requirements, emerging mobility technologies and desired industrial efficiency are all driving major change in the Asia-Pacific lubricants market. Here’s what to know and how to take advantage of such trends.

Change is happening no matter where you look in the global lubricants marketplace. But perhaps nowhere is that more true than throughout the Asia-Pacific (APAC) region.

This region, led by China, today represents the largest global region in terms of lubricant consumption. According to research from Kline & Co., APAC accounts for more than 40% of the global market, where demand for finished automotive and industrial lubricants is forecast to reach 18 million tons by 2027—up from 16.7 million tons in 2022. China specifically is the most dominant lubricant market among the APAC countries; demand for finished fluids is expected to reach 6.3 million tons by 2027, at a 1.3% compound annual growth rate (CARG) from 2022.

Growth and demand for lubricants are occurring simultaneously as several major global trends continue to impact the marketplace. Increasingly stringent emissions and fuel economy regulations—specifically, the China 6 standard—and continued electrification of the vehicle landscape will make up the key challenges lubricants and additive companies will need to overcome.

But with challenge comes opportunity. Technological change within the automotive marketplace will require advanced lubricant formulations and high-performance additive chemistry. These top-tier fluids will deliver new value to the industry at large and to the lubricant formulators responsible for their creation. Here is a closer look at how these trends will shape the APAC market for the foreseeable future and how lubricant marketers in the region can take advantage.

Grappling with China 6, the World’s Strictest Emissions Standard

China 6 has come into staggered effect over the past few years: China 6a went into effect in 2021 and China 6b, with further tightened limits on criteria pollutants in both lab and real driving tests, went into effect in 2023. China 6 thus became the most stringent emissions standard, overtaking Europe’s Euro 6 standards for new vehicles. 

The regulations are largely targeted at removing many thousands of tons of serious pollutants, including particulate matter (PM) and oxides of nitrogen (NOx). Meanwhile, Chinese fuel economy legislation that applies to both passenger cars and commercial vehicles will further require original equipment manufacturers (OEMs) to hit increasingly high fuel economy targets, all while dramatically reducing emissions.

China 6 is based on several important criteria that reduce emissions, including real driving emissions (RDE) testing, emissions durability and in-use compliance. The result is a completely reshaped Chinese—and indeed, global—vehicle marketplace. 

It is worth examining the criteria in detail. RDE measures key emissions over a range of real conditions using portable emissions measurement systems. China 6b also incorporates a wider range of differing RDE conditions, including higher altitudes and wider loads (ranging from 10% to 100% capacity) for commercial vehicles. Next, emissions durability measures a vehicle’s ability to maintain low emissions throughout its useful life. China 6’s intention here is to ensure that air quality benefits are long term. Finally, in-use compliance will be monitored via on-board diagnostic systems (OBD) for emissions performance on most vehicles. Significant penalties will be levied for noncompliance.

OEMs targeting sales of new vehicles into the massive Chinese market must adhere to these standards. To remain compliant, it Is expected that OEMs will utilize a few key technologies. These include turbocharged gasoline direct injection (TGDI) engines. Passenger cars are expected to use TGDI engines, which combine high power and fuel efficiency and are often downsized to take advantage of their power density. 

OEMs are also exploring new fuel injector strategies in heavy-duty diesel applications, though they are more subtly tweaked in comparison to their gasoline-powered counterparts. Fuel injection pressures will likely rise. Improved injection control and multiple injections per stroke will make an additional impact. Optimized turbocharging will be used to improve combustion, while steel pistons with optimized combustion bowls will likely see use. Meanwhile, due to China 6’s particulate number limitations, near-universal adoption of gasoline and diesel particulate filters (GPFs and DPFs) is occurring. These devices are effective at removing more than 90% of particulates and will inevitably be deployed by all OEMs in order to do business in China and APAC.

China 6’s Implications for Engine Lubricants

China 6 does not impact the lubricant directly, but there are significant implications for fluid performance in new vehicles. This is because new drivetrain technologies required to meet the standards demand higher levels of performance from the lubricant. 

Interaction with GPFs and DPFs. The lubricant’s interaction with particulate filters will be a critical consideration for formulators moving forward. Catalytical coating could be applied on DPF and GPF to promote the oxidation of collected soot. However, this coating has the potential to interact poorly with phosphorous and sulfur levels found in many traditional lubricant formulations. These materials can either form a barrier that stops the interaction between the exhaust gases and the coating, or it can directly compromise the coating’s effectiveness. 

The good news is that lower sulfated ash, phosphorus and sulfur (low SAPS) content in lubricants can alleviate these concerns, reducing lubricant-derived contaminants that can lead to GPF blocking. Lubrizol has performed extensive field trials to demonstrate the effectiveness of low-SAPS lubricants on new engines. Three engine oil types were evaluated. All were SAE 0W-20 viscosity grade but were formulated with varying levels of sulfated ash, ranging from 0.8% to 1.3%. Higher-ash engine lubricant showed increased levels of collected ash within the GPF itself and demonstrated higher exhaust backpressure. By contrast, lower-ash lubricants delivered better power and fuel economy gains against the higher ash formulation. Additionally, the collection of a small quantity of ash enabled improved GPF performance, yielding a 99% reduction of PN.

Combatting Low-speed Pre-Ignition in TGDI Engines. OEMS continue to deploy TGDI technology to improve vehicle efficiency; they will certainly be necessary to meet the demands of China 6. To achieve more efficient operation, TGDI engines run hotter and at higher pressures than their traditional port fuel injected engine counterparts.

These operating conditions have an impact on the lubricant. Higher levels of oxidative and thermal stability are required to prevent premature breakdown of the oil while the engine runs. More importantly, TGDI engines are susceptible to a unique phenomenon known as low-speed pre-ignition (LSPI). 

LSPI events are random and infrequent but can cause very high pressure spikes, loud knocking noises and sometimes catastrophic engine damage. But modern engine oils formulated with the right performance characteristics can help prevent LSPI. Modern vehicles require modern lubricants designed specifically to meet challenges like LSPI.

Lower and Lower Viscosities. Finally, it is expected that both China and Japan will continue to drive the overall market toward ultra-low viscosities (defined as 0W-12 and below) in the near future. As viscosities trend thinner, high-performance additive chemistry will be increasingly required to enable such lubricants to maintain their protective properties over the long term.

An overall market upgrade for a new generation of vehicles is underway, and as an organization, Lubrizol is committed to helping oil marketers throughout the region achieve what is needed to succeed under China 6 and beyond. To those ends, we are already looking ahead to China 7, which is now in the early stages of development. 

Changes in Industrial Fluid Applications

Beyond China 6 and its implications for the vehicle market, we are also seeing new requirements for lubricants in the industrial space. Greater sustainability is again the key driver here, and energy efficient hydraulic fluids and industrial gear oils can help contribute to dual carbon targets. 

In addition, end users are looking to extend drain intervals to minimize downtime and deliver a lower total cost of ownership while maintaining equipment life. Moreover, at the operator level, users are also looking for a better customer experience beyond robust and reliable equipment protection (e.g., use of color-stable hydraulic fluids).

Emerging Technologies and their Impact

APAC’s drive toward sustainability will of course extend beyond the traditional internal combustion engine. More advanced alternative energy technologies and hardware are beginning to impact the marketplace. Alternative fuels like hydrogen and natural gas are gaining traction, offering consumers more choices and subsequently making lubricant compatibility even more complex. 

Meanwhile, the electric vehicle (EV) revolution is well underway around the world. While Tesla is the highest-profile EV maker in the world, many new entrants in China are competing for market share. Their routes to market are very different from traditional OEMs—a shift that will require careful analysis of how and where the lubricants industry can provide value to these new players. And while China leads e-mobility growth in the Asia-Pacific region, we are also seeing investment in the e-mobility value chain coming into the Southeast Asia region.  Much of this is driven by the manufacturing agendas of governments in those countries, furthering regional opportunities for sustainable innovation.  

EV-specific solutions, encompassing axle oil, transmission fluids, grease, powertrain and battery thermal management systems, will be increasingly necessary as EVs continue to proliferate around the world. The right additive materials and technologies will be required to help improve durability and lithium-ion battery safety. 

Meeting the Challenges

China 6 and the inevitability of China 7, the changing requirements of industrial equipment and revolutionary changes in mobility technology have massive implications for the lubricants marketplace in APAC and around the world. Taken cumulatively, these trends will require significant innovation and investment to manage the complexity and fragmentation in the lubricant space in order to help today’s and tomorrow’s vehicles to meet their full potential. 

True partnership between lubricant manufacturers, additive suppliers and OEMs will be a necessity to address a wide variety of vehicle needs, including improving energy efficiency, reducing emissions, and enhancing engine reliability and durability for internal combustion engines and electric and hybrid vehicles. 

To help meet these needs throughout APAC, Lubrizol continues to invest in in-region innovation capabilities to enable local technology development in market spaces where Asia leads or needs differentiated solutions. As the market grows and evolves, we remain committed to advocating for the lubricant industry—as sustainability efforts level up and emerging technologies further push the boundaries—together.  

Ping Zhu is vice president, Lubrizol Additives Asia Pacific. 

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