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‘Lubricants industry expects huge shift in technology’ [Sep 2011]

The lubricants industry in India is growing at a pace of 3.9% year-on-year. Sandeep Kalia, CEO of Valvoline Cummins expects a major shift in technology and customers will upgrade themselves to long drain lubes, which will strengthen their position.
Please discuss about Valvoline-Cummins and your activities in India. Valvoline Cummins Ltd (VCL) is a joint venture of Valvoline Inc. USA and Cummins India Ltd. In India, we started our operations in 1998. Today we are one of the India’s fastest growing lubricant brand in the country. Over the last few years while the lubricant industry has grown by 3-4 per cent per year, we have been clocking high double digit growth rates.
How do you see the lubricants market in India?Indian economy is witnessing a steady growth. As far as lubricants business in India is concerned, the current market is over 1.8 million metric tonne and for any foreign brand like us, accessibility is close to just 50 per cent of the entire market. The industry is projected to grow at a rate of 3.9 per cent year-on-year till 2013. However, we are expecting a major shift in technology and customers will upgrade themselves to long drain lubes, which will strengthen our position.
Can you brief us on your products range? Valvoline-Cummins product range and their technical attributes are different from those in the market, particularly their advanced additive technology and premium base oil attributes ensuring high performance and enhanced engine life.
Our products range includes all types of automotive lubricants (diesel oils/motorcycle oils and passenger car oils), transmission fluids, gear oils, industrial lubricants, speciality products, greases and cooling systems.
Out of the wide range of products, which is that one product that holds the key to your business?Our key business is the diesel lubricants both for on and off highway applications. Our products are superior in quality as we use only group II and group III base oils. The additives that we use in some of our flagship products like Premium Blue makes them unique and possibly the best diesel engine oil available today. Valvoline Cummins is also one of the major lubricant players in power generation segment. Our wide-presence enables us in providing a complete line of Valvoline products across the country.
Valvoline has the expertise in developing and marketing high performance oils in more than 140 countries. Are you going to develop any solutions keeping in mind the need of Indian market?We were testing the next generation CI4+ oils in India as the latest engines are becoming more environment-friendly, and our lubricants are developed to deliver the results as per the latest norms like Euro IV and BS IV.
We recently got this product (Premium Blue Plus CI4+) approved by Tata Motors for all their 6Bt 5.9L BSIII mechanical engines. This is a huge opportunity which will benefit customers to shift to high performance oils for their vehicles.
How did your company perform during the last couple of years and what kind of growth are you expecting?Valvoline Cummins has experienced high double-digit growth for the last few years and has emerged as one of the fastest growing foreign brands in India. We will continue to maintain the same growth rates driven by our strong distribution both in after market and in the off highway segment. We target to deep dive into the MCO and the fleet categories in the coming years.
What is your opinion about co-branding with the construction equipment OEMs?The co-branding and private labels are two well accepted business methods where lubricant companies and CE OEMs partner to effectively serve the end users. The co-branded products are marketed through the lubricant manufacturer’s distribution network and the OEM’s dealerships network while private labels are generally marketed only from the OEM’s dealerships. In co-branding, the brand names of both the companies are simultaneously pooled thereby creating a better brand building for both.
Further, the customers get benefitted with a one stop solution for all their lubricant needs. We have successful tie ups with many global CE OEMs like International Tractors, Terex, Mahindra, Swaraj Mazda, ELGI, Ajax Fiori etc.
What are the various value added services you offer to guide end-users in selecting appropriate lubricants for their application?We have a customer care cell where we have technical experts addressing the calls of consumers and educating them of good quality lubricants and their right application. We also have a setup for used oil testing called ‘progressive oil sample testing (POST)’ which is a state-of-the-art predictive and preventive maintenance programme designed to decrease downtime, extend component life, optimise oil drain intervals and monitor fluid quality. This facility can be operated from web VCL which gives unique ID and password to each user to monitor their historical test data and plot trend graphs etc.
Can you update us on your manufacturing facility in India? What will be the production capacity?To meet our targeted growth in India, we are setting up a state-of-the-art manufacturing facility here. The construction of the plant is in full swing and is estimated to start commercial production by the middle of next year. The capacity will be in excess of 120 million litres.
What are your future expansion plans?VCL is setting up a state-of-the-art manufacturing facility to fulfil the targeted growth in India. The construction is in full swing and is estimated to start from mid 2012 onwards. This facility is also targeted to be a fully green facility.

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