May

Amsoil President A.J. Amatuzio

In a Dealer newsletter I read recently, the author shared the sentiment that “there has never been a better time to be an AMSOIL Dealer.” We have all heard this before. Maybe even too many times. I have said it myself. But each time I have said it, it was true. With each succeeding year we see forces within the industry pushing even harder toward increased demand for synthetic lubricants. Along with that, of course, is the continued push toward extended drain intervals. The world is catching on. The demand for our products is increasing, and, yes, the opportunity does keep getting better for AMSOIL Dealers. It is not difficult to identify some of the circumstances throughout the years that have advanced our cause. In the mid-seventies when Mobil 1 was introduced, many Dealers expressed concern. They feared that with a second synthetic motor oil now on the market, our sales would suffer. I knew, however, that Mobil’s near-limitless advertising budget would ultimately work in our favor. They would spend millions to help educate the public on the benefits of synthetic oil. They did, and we grew.

It was about this time that gasoline was in short supply and prices soared. Fuel economy became a major concern, and our gas-guzzlers of the sixties were being replaced by more fuel efficient compacts. As the need among consumers to cut fuel costs increased, our Dealers capitalized with sales of lubricants that actually did make a difference. We are seeing similar concerns with fuel economy today, particularly in the commercial market. Another significant event impacted the demand for synthetics. This one more subtle, perhaps, than the Mobil 1 introduction, but significant nonetheless, especially as an indicator of where the industry was headed. In early 1991, General Motors halted sales of the Corvette ZR-1. Eight engines had seized at its Bowling Green, Kentucky assembly plant. The temperature had dipped to slightly below freezing and, at start-up, hardto- pump motor oil did not reach the front camshaft bearings. They were destroyed by lack of lubrication. GM responded by requiring the use of synthetic oil in the Corvette, as well as its Syclone pickup truck. It was the first time an American auto manufacturer had required, not just recommended, but required the use of a synthetic oil as a factory-fill. It was clear to me then that GM’s decision was just the beginning. More factory- fills would follow. The door had just opened a little wider for AMSOIL Dealers.

Not long after the Corvette was treated to synthetic oil, virtually all the other oil manufacturers introduced synthetics of their own. They, like Mobil, spent millions advertising their “ground-breaking” new products. Castrol alone spent $25 million. The floodgates had opened, and as awareness among consumers reached an all-time high, our sales continued to climb.

Today, of course, consumer awareness has never been greater. According to one source, the demand for synthetic motor oil is projected to grow at a rate of more than 7.3 percent per year through 2013. Others have projected even higher rates. Growth is expected to continue in the light vehicle market, with a strong push in the medium and heavy-duty truck markets.

Transmission fluids and hydraulic oils are also expected to increase in demand. There are other trends working in our favor. Drivers are keeping their vehicles longer. They are putting tens of thousands of more miles on their current vehicles than they put on their previous vehicles. That means thousands of more dollars spent on maintenance. As this trend continues, we’ll see demand for our products increase and opportunities for our Dealers expand.

Our established and well-deserved reputation as the leader in extended drain technology will continue to create opportunities, as well. As it stands now, the majority of drivers have moved beyond the 3,000 mile drain. Reports suggest that the average person changes oil every 4,500 miles, which may be conservative. And now, as auto manufacturers continue to extend their oil drain recommendations, that number will increase.

Those who purchase a Ford today are instructed by their owner’s manual to change their oil at 7,500 miles. GM owners are instructed to change theirs according to their oil monitoring systems. In some cases, that can go well over 10,000 miles. GM went as far as endorsing the California Environmental Protection Agency’s “3,000 Mile Myth” campaign to educate drivers on extended drain intervals and reducing oil consumption. This all leads to even more opportunity for AMSOIL Dealers. The movement toward synthetic lubricants and extended drain intervals has gained irreversible momentum, and the future for our Dealers has never looked brighter. In fact, and I’ll let you finish the line for me, “There has never been a better time…”