Valvoline Cummins: A Successful Indian JV [Apr 2012]

Valvoline Cummins Limited (VCL) is a 50:50 joint venture set-up in 1998 between the U.S. based engine oil manufacturer and the diesel engine maker Cummins India Ltd. The joint venture company, VCL, had introduced products across the spectrum that ranges from commercial vehicles to two wheelers and passenger cars. Today, the company has a market share of close to 8 per cent and is targeting more than 10 per cent in the next 2 years.
Highlighting the company’s performance growth over the years, Sandeep Kalia, CEO at VCL said, “When we started in 1998, VCL raked in a turnover of `20 crore. During the last year of operations, we secured a turnover of more than `900 crore. We have witnessed a tremendous growth rate in the last decade and expect to continue with same momentum”. In a price sensitive market like India where fluctuations in the interest rates can easily cause a dent in the ever inflating sales, the engine oil maker, VCL maintains a CAGR of 20 per cent consistently. “India has become the most lucrative business destination for Valvoline outside U.S.”, said Mr. Kalia while explaining the dynamics involved in the engine oil space in two wheeler market.Targeting the 2-wheeler customers, VCL has a highly capable R&D team based at Valvoline, U.S. and a superior technical team in India. They are keeping tracks of all kind of upcoming engine technologies; keeping in touch with the OEMs to eventually make the best fit engine oil for the bikes and scooters. With fuel prices going up, VCL recently introduced premium engine oil (Syn Power 4T) which could enable up to 8 per cent of fuel savings. VCL has developed this oil typically on the Honda motor engine oil concept targeting to save fuel. Using the ultimate synthetic technology, this stands as a benchmark in 4 stroke motorcycle engine oil. Also the Champ 4T has been upgraded to SM grade for better performance and PBM technology has been added to the product for power performance and protection.

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