MOSCOW, April 18 - RIA Novosti / Prime. The Russian lubricants market has great potential even in difficult economic conditions and will remain among the five largest in the world even in 10 years, Fabien Voisin, CEO of Total's subsidiary in Russia, Total Vostok, said in an interview with RIA Novosti.
"This market is the fifth largest in the world. I think it will retain its position or even become the fourth," - said Voisin.
The head of Total Vostok, a company that supplies motor oils and lubricants under the Total and Elf brands to the Russian market, notes that there is room for growth in the Russian market, even if it is now showing a downward trend. This allows the company to be confident in it, and therefore to invest. Already next year, Total Vostok expects the growth of the Russian market, the volume of which is this moment is about 1.3 million tons, about 1%.
"Since the establishment of our company in Russia (since 2008 - ed.), the Total Vostok business has been demonstrating positive dynamics, even in recent years, when the economic situation is not the most favorable. We see huge potential in this market. Because we are confident in it, we are investing in it: we are investing in a project to localize production, we are investing in sponsorship," Voisin said.
WHO IS THE MAIN HERE AND WHAT TO DO WITH IT
The alignment of forces in the lubricants market of the Russian Federation, as well as in many other large markets of the world where there are local players, according to the head of Total Vostok, is quite standard - local, Russian companies dominate.
"In this market, domestic producers remain the main players: Lukoil, Gazprom Neft, Rosneft. They occupy about 60% of the market. These are integrated companies. They have refineries, oil sources, their production chain begins and ends in Russia. So they have a competitive advantage," Voisin said.
“But this advantage is concentrated mainly in the segment of low and medium quality products. As for the segment of high-quality lubricants, a significant share of it belongs to foreign companies, such as Total. In this market, our share is greater than that of some Russian manufacturers,” said the head of Total Vostok.
At the same time, in order to successfully compete in the Russian market, Total Vostok decided in October last year to build its own plant for the production, storage and shipment of automotive oils, lubricants and related materials. The production capacity of the project at the initial stage will be 40,000 tons per year, later it can be increased to 75,000 tons. The investment amount is $50 million, the launch of the plant is scheduled for 2018.
“We are implementing this project because we are confident in the future of the Russian market, and also, perhaps, because we felt that without investment in it, our business would stagnate or even decline. Having our own plant will become a competitive advantage: we will benefit from the use of production of local materials, we will be less subject to fluctuations exchange rates", - explained the head of "Total East".
INNOVATION AND FUTURE GROWTH
In general, the share of "Total Vostok" in the lubricants market of the Russian Federation is currently 3%, in a number of segments - 10%, said Voisin. In the next five years, the company expects to reach a target of 5%.
The company is building plans for future development, including with the expectation of high-tech products. In particular, the head of Total East mentioned created by the company Lubricants based on a proprietary formula that provide up to 5% savings in automotive fuel consumption.
"This is what we, among other things, do in Russia - make such products available to Russian consumers. Considering low cost energy in the Russian Federation, consumers may not be ready to bear additional expenses by purchasing these products. But we believe that things are changing now. Therefore, we want to be present on the Russian market today with similar products, counting on the fact that its share will increase in the future," Voisin said.
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Except big size The motor oil market has a second specific feature. Their production does not require large investments, since it consists in mixing the base oil and a set of additives, followed by bottling into consumer packaging.
Together, these two factors explain why there are so many brands on the Russian market. In 2016, customs counted more than 190 foreign brands alone. What requires investment is the production of base oil. Of the 15 brands in our top 15, five belong to Russian companies. Let's clarify: Russian oil concerns. And this is a predictable result, given that they themselves produce the base oil, and in addition, they own large networks of filling stations, which allows them to reach the consumer without intermediaries.
Russian chemists and trading operators do not have such resources, so the brands they have created (Sintec, Sintoil, Volga-Oil and others, about a dozen in all) are inferior to the brands of oil companies. Everything is natural here. But for all their strength, Russian oil companies in the home market are inferior to American and British concerns with their Mobil brands, Shell, Helix and Castrol. How can this be explained? Are foreigners more experienced in marketing? Or do they make a better product? In any case, the Lukoil, Rosneft and Gazpromneft companies still have work to do.
Top 10 foreign brands
1 place | 2nd place | 3rd place |
4(5**) place | 5(6) place | $7.24 billion
|
$ 0,95%
| 6(8) place
| 7(10) place
|
8(12) place
| 9(14) place
| 10(15) place
|
Top 5 domestic brands
1(4) place | 2(7) place | 435 million liters annual requirement
|
3(9) place | 4(11) place | 5(13) place |
The Russian motor oil market is being transformed under the influence of economic factors. First of all, large domestic companies are strengthening their market positions, which are actively declaring the expansion of production capacities and increasing competitiveness in the premium segment.
The Russian lubricants market is the largest in Europe and the fifth largest in the world. Its volume in 2016-2017 is estimated at 1.6 million tons, which is practically the same as in 2015, but about 10% less than in 2014 (excluding base oils, plasticizer oils, lubricants and cutting fluids - coolant). The market contraction relative to 2014 is due to the current economic situation, the sanctions of Western countries, the devaluation of the ruble and the decline in car sales.
True, experts expect that after 2016 sales passenger vehicles will begin to grow again, which should have a positive impact on the demand for lubricants. By 2020, the lubricants market may increase by 12% compared to 2015.
Of the total volume of consumed lubricants, about 280 thousand tons are accounted for by motor oils of the passenger segment, the annual growth of which does not exceed 2%. In the region of 650 thousand tons, the commercial segment “eats” ( public transport, marine oils, railway needs, etc.), and about 600 thousand tons fall on the industrial segment.
According to the data of the AUTOSTAT agency, the need for engine oils for passenger cars, light commercial vehicles (LCV) and trucks in Russia in 2015 exceeded 400 million liters. An eighth (12.5%) of the total specified requirement is for the LCV segment, which corresponds to 52 million liters. Approximately one third (32.5%) is occupied by trucks (135 million liters). With comparable fleet sizes, the large demand for motor oils in trucks is explained by the difference in other calculated indicators. So, trucks have more volumes of the engine lubrication system. In addition, they have high mileage, which entails more frequent replacement oils.
AUTOSTAT notes that the majority of trucks are equipped with diesel engines, therefore their need for appropriate motor oils is noticeably higher. So, for the share of oils for diesel engines the truck segment accounts for 74% or 100 million liters quantitatively. For LCV this figure is 29% (15 million liters). And it is least of all in cars (5% or 12 million liters), since diesel engines are in limited demand in this segment.
According to AUTOSTAT, over half (55%) of the total consumption of motor oils fell on cars, that is, 230 million liters. Of course, this is due to the huge fleet of passenger cars in the country, which is five times larger than that of trucks and LCVs combined. At the same time, more than 75% of this volume falls on the European part of Russia. Thus, the share of the Central Federal District, which has the largest fleet in the country, accounts for over 30% of the total demand for motor oils for cars. In quantitative terms, this corresponds to 72 million liters.
Production
According to Gazpromneft-Lubricants, Russian oil refineries have been producing about 2.4 million tons of group I mineral base oils in recent years, 50% of which is exported. The main area of application of mineral base oils in Russia is industrial production (about 700 thousand tons per year). The largest consumers here are the oil refining, energy, metallurgical and automotive industries.
Recall that group I - base mineral oils, group II - more valuable semi-synthetic oils, group III - synthetic oils with the highest degree of purification.
In order to compete with importers in the segment of high-quality motor oils, in most cases, domestic manufacturers purchase group III and IV base oils on the world market for their own production of semi-synthetic and synthetic motor oils. In this regard, many domestic oil producers are striving to invest in projects for the construction of Group II and III production facilities in Russia, as well as to develop packaging production.
According to Rosstat, 519.8 thousand tons of motor oils were produced in Russia in 2015 compared to 520.6 thousand tons in 2014. In January-April 2016, the volume of motor oil production in kind amounted to 167.5 thousand tons, which is 10% more than in the corresponding period of 2015
It should be noted that oil companies are trying to cover their losses resulting from a decrease in profits from the export of crude oil at the expense of the domestic market of petroleum products. Therefore, in value terms, the volume of motor oil production in the country is growing at a very significant pace. In January-April 2016, the production volume amounted to 14.9 million rubles, which is 91% more than in the corresponding period of 2015. At the same time, for the whole of 2015, the growth in the value of production amounted to 38% (31.2 million rubles).
As Maxim Donde, director of lubricants company PJSC LUKOIL (LLK-International LLC), notes, in 2015, when there was a decline in industrial production and the volume of cargo transportation, the decrease in consumption was more significant - at the level of 10-11%, and it happened due to a decrease in the share of imported oils.
Import
According to experts, the main trend in the domestic motor oil market is a decrease in imports. As part of the import substitution vector, Russian market players are actively investing and modernizing production facilities. By increasing the volume of purchases of imported additives, Russian enterprises are trying to force imported motor oils of grades II and III of groups out of the market.
According to Gazpromneft-Lubricants experts, in 2014 the supply of imported motor oils to Russia amounted to about 400 thousand tons. Deliveries are mainly carried out from Europe. In 2015-2016, the volume of imports amounted to 250-300 thousand tons, and on the horizon of 2018, imports will continue to decline, and it is quite possible that their annual volume will not exceed 100-150 thousand tons per year. However, this is not the only prediction.
According to AUTOSTAT, in 2015, at the peak of the economic crisis, Russian consumers still preferred imported motor oils. The most popular of these is the Mobil brand. Next come Castrol and Shell. There is only one Russian brand in the top ten - LUKOIL.
In the passenger segment, the share of motor oils for gasoline engines accounts for up to 70% of sales, of which 75% are imported products. At the same time, 50% of sales in the passenger segment are occupied by synthetic oils (group III).
Thus, experts believe that until 2025 the volume of imports will remain at the level of 250-350 thousand tons per year. This is due to the fact that foreign vehicles account for 53% of the domestic vehicle fleet. Steady demand for imported synthetic oils is due to the same factor. This is especially evident given the expected recovery in car sales growth.
Meanwhile, import substitution in the field of lubricants is a completely natural process that began in the mid-2000s. Experts acknowledge that Russian manufacturers motor oils today produce products that are in no way inferior in quality to the world's leading manufacturers. At the same time, the price increase for domestic motor oils in 2015 amounted to 8%, while imported oils rose in price by 31%.
According to Maxim Donde, given the uncertainty of the exchange rate, the future volumes of imports are an open question. The Ministry of Economic Development predicts the growth of the industrial production index in the amount of 1-3%. Oil consumption will also grow almost symmetrically. The strengthening of the ruble and the reduction of costs due to the localization of production may well give a number of foreign players the opportunity to increase their share in the Russian market.
“We understand that a long-term bet on price competitive advantages should not be made. LUKOIL will promote products that are not inferior to imported counterparts or surpass them in terms of performance,” says Maxim Donde.
In general, when choosing a product of a particular brand for the purpose of resale, the vast majority of distributors (their share in the total sales volume is 60-70%) focus primarily on price and quality. For retail chains (their share in the passenger segment is 50%), brand recognition is a fundamental factor. As for car dealers, for them the choice of engine oil is determined by the terms of the warranty and the recommendations of automakers.
Top five
The main share of motor oils in Russia is produced by such large oil companies as Rosneft, LUKOIL, Gazprom Neft, as well as a number of other companies, including Shell (factory in Torzhok) and the Delfin Group Trade and Industrial Association.
OOO RN-Lubricants - subsidiary Rosneft, engaged in the development, sale and promotion of the company's lubricants. The production of high-quality lubricants and additives is carried out by five large enterprises: Novokuibyshevsk Plant of Oils and Additives, Ryazan Oil Refining and Angarsk Petrochemical Companies, PJSC Rosneft-Moscow Plant Nefteprodukt, OJSC Slavneft-Yaroslavnefteorgsintez.
The range of lubricants allows you to meet the needs of both large industrial enterprises and professional buyers, as well as private consumers, and includes more than 1 thousand items.
At the end of 2015, the total production of oils, additives and other related products at Rosneft amounted to 779 thousand tons, including over 720 thousand tons of commercial oils, which is about 30% of the total production of commercial oils in Russia.
Currently, Rosneft continues to implement a large-scale investment program to modernize the production of key components for automotive oils and liquids. As a result, the company expects not only to replace most of the imported key components in the existing range of motor oils, but also to become a supplier of raw materials for other oil producers.
LUKOIL in 2016 expects to reach a record level of sales of oils and lubricants. In the first half of 2016 alone, the subsidiary of LLK-International increased sales of finished oils and lubricants by 15% compared to the same period in 2016, reaching 435 thousand tons.
At the same time, the growth in the volume of import substitution products on the Russian market in the segment of LUKOIL motor oils amounted to 10%, in the segment of industrial oils - 20%. In the company's sales structure, the share of products that meet the requirements of international automakers and manufacturers of machinery and equipment has grown from 33% to 41%.
LLK-International is also actively developing sales abroad. Priority markets include France, Sweden and Germany, where in March 2016 LUKOIL began supplying fuels and lubricants German manufacturer trucks and MAN buses Truck & Bus. In September 2016, the company won the tender for the first filling of oils in Mercedes-Benz vehicles at a plant in Germany.
LLK-International considers the countries of the Asia-Pacific Region (APR), including China, Japan and Vietnam, as promising regions for itself. The main volume of production will come to these markets from a plant under construction in Kazakhstan, which is scheduled to be commissioned in 2018.
In addition, LUKOIL is negotiating with Iran on the supply of oils and additives to the country from the company's Turkish plant. The company also sees potential in entering the oil markets of Egypt, South Africa and Nigeria, where there is an organic growth in the consumption of lubricants.
Currently, LUKOIL produces about 1 million tons of lubricants per year at nine production sites in Russia, the Republic of Belarus, Austria, Finland, Romania and Turkey, as well as at 26 involved plants around the world.
Gazprom Neft - Lubricants - a subsidiary of Gazprom Neft engaged in the production and sale of oils, lubricants and technical fluids. The company owns production assets in Western Siberia (Omsk), in the European part of Russia (Yaroslavl and Fryazino), as well as in Italy (Bari) and Serbia (Novi Sad). In the period from 2008 to 2014, the company's investment in innovative technologies and in the development of products amounted to 162 million euros, and by 2025 investments in technology and production will reach 380 million euros.
The product range of Gazprom Neft - Lubricants includes about 500 types of oils sold under the Gazprom Neft and G-Energy brands. The company's products are sold through the Gazprom Neft filling station network, as well as through deliveries to retail chains, online stores and 1,500 service stations.
In addition, the company supplies oils to assembly lines. largest manufacturers vehicles in Russia and abroad: Avtotor ( General Motors, Hyundai), Mercedes Benz Trucks Vostok and Derways (Lifan), MAZ, chief assembly line"GAZ" and others.
At the same time, over 9 months in 2016, Gazprom Neft - Lubricants increased exports in the premium product segment by 21%. According to the head of the company Alexander Trukhan, in 2016 the company entered the markets of Vietnam, Colombia, South Korea, South Africa and Poland. In just 9 months of 2016, the volume of exports of premium products amounted to 68 thousand tons, deliveries are made to 65 countries of the world. At the same time, the lion's share of exports falls on Europe. Annual export growth is projected at 20%.
Alexander Trukhan also said that the volume of lubricants output in 2016 in the company will be about 540 thousand tons (an increase of 4-5% compared to 2015), given that production capacities are 100% loaded. In particular, the volume of premium products will increase by 12-13% and amount to about 250 thousand tons.
According to him, in Russia, the company's share with a total volume of 1.6 million tons accounts for 15-16% of the lubricants market, the target market share (packaged products) is 19%.
Oils under the Gazprom Neft brand are produced at the Omsk Lubricants Plant (OZSM). The modern complex for mixing, packaging and packaging of motor oils is designed to produce 110,000 tons of motor oils and pack 180,000 tons of finished products per year. The production is certified according to the ISO16949 standard, which allows us to supply products to the conveyors of the world's largest automakers.
Oils under G-Energy brand produced at a factory in Bari (Italy). The plant is a modern, high-tech complex production capacity up to 30 thousand tons of high-tech oils and 6 thousand tons greases in year. The plant is certified according to the ISO international quality system (compliance with the requirements of ISO 9001 and ISO 14001) in the field of production, packaging, storage and sale of oils and lubricants.
Factory SHELL in Torzhok with a capacity of 200 million liters per year is one of the largest enterprises of the Dutch-British concern. The plant produces a wide range of high-quality lubricants, including motor oils, oils for marine engines, industrial lubricants, hydraulic and transmission oils. The plant's portfolio includes the following brands: Shell Helix, Shell Rimula, Shell Spirax, Shell Tellus, Shell Omala.
Delfin Group - an association of jointly developing legally independent commercial companies, the product portfolio of which includes both Russian trademarks and well-known world brands. Luxoil, the largest manufacturer of motor oils and car chemicals, later renamed Delfin Industry, became the first domestic enterprise to enter the structure of the Delfin Group and laid the foundation for its full-fledged existence.
In December 2005, another member joined the Delfin Group — the Russian industrial group Spektr-Avto, Russia's oldest independent domestic manufacturer advanced Spectrol lubricants.
Currently, the portfolio of Delfin Group includes brands of various price segments: Spectrol and Highway oils are in the above average category; to the middle price group - Luxe; to the price group below the average - the products of Oilright, Yarneft and Pilots. All these brands include a full range of automotive oils: mineral, synthetic and semi-synthetic motor oils.
Market prospects
In general, representatives of the domestic motor oil market quite positively assess the prospects for its development. However, without a fly in the ointment is not complete.
The Delfin Group notes that at present the market is characterized by a decrease in the already low growth rates, which is due to the economic crisis in the country. The increase in sales of foreign cars also plays a role. Russian assembly, which are dominated by passenger cars with increased requirements for the efficiency of fuel and oil consumption.
Besides, own production oils in Russia, together with imports, exceeds consumption, the surplus is shipped for export. At the same time, counterfeit products remain a significant problem on the market.
As Maxim Donde notes, the volume of consumption of lubricants is historically correlated with the index of industrial production. According to the calculations of Rosstat, this year industrial production may show a slight increase. However, taking into account the global trend towards the use of more advanced and economical oils with an extended drain interval, it is quite natural at the end of 2016 that a decrease in oil consumption by 2-3% looks like. A similar trend can be traced in most markets of developed countries.
The macroeconomic situation played in favor of Russian oil producers. An increase in the exchange rate automatically led to an increase in import prices. The rising cost of imported products has forced many consumers of oils to reconsider their preferences and make a choice in favor of those Russian brands, whose operational characteristics are not inferior to foreign analogues.
“Price alone is not enough to win the attention of the consumer. He understands that the cost of repairing an engine is not comparable to the cost of a can of oil. Therefore, motorists are looking for a high-quality alternative to imports, carefully studying the characteristics of the product,” says Maxim Donde.
LUKOIL is also paying attention to the current huge selection oil brands. However, often not all of these oils are able to provide enough efficient work technology in Russian conditions operation. At the same time, despite the fact that in Russia there are a lot of quality oils produced by domestic companies, foreign products still dominate in the additive segment.
Gazpromneft-Lubricants believes that further development The Russian motor oil market is characterized, first of all, by an increase in demand for high-tech oils, which is associated with an increase in the market for modern cars. At the same time, the share of sales of oils produced by domestic enterprises will grow, which is due to the fact that manufacturers bring technological capabilities in line with market needs.
In preparing the article, materials from EY and Russian Automotive Market Research were used
Plots:Competition in the Russian lubricants market is growing. This process is most active in the segment of premium high-tech products. And one of its characteristic indicators is the massive advertising of foreign producers on domestic TV. Alexander Trukhan, General Director of Gazpromneft-Lubricants, told the correspondent of SN about how he feels in these conditions, the operator of the oil business of Gazprom Neft.
Did Gazpromneft-Lubricants manage to hold its positions in the market last year?
We managed not only to maintain, but also to strengthen our positions: today 20% of packaged lubricants on the Russian market are our products. But most importantly, we continued to implement our business development strategy aimed at technological leadership in the domestic lubricants market. As a result, we were able to introduce new production technologies, expand our product portfolio with innovative products, and also enter new challenging market sectors. The result of this work is visible in sales volumes and revenues, but the main thing that we managed to achieve is that we were able to increase the percentage of involvement of our own raw material base in the production of high-tech products.
What are the real steps behind the words about technology leadership?
Alexander
Trukhan
CEO
"Gazpromneft - lubricants"
We constantly invest in the quality of lubricants, find new approaches to technological processes. Last year, we localized the production of lithium and calcium lubricants in Omsk, which were previously produced only at our plant in Italy. In addition, in Omsk in 2016 we produced over 5.5 tons of additives, of which about 3 tons are involved in our own production of lubricants. This is a technological breakthrough that allows us to produce a range of products with maximum use of our own components.
Of the plans that are already becoming a reality, this year we are starting the production of our own III group of base oils in Yaroslavl. This is really a breakthrough both in terms of import substitution and in terms of production quality, which the Yaroslavl Oil Refinery (YANOS) can provide today. We prepared thoroughly for this event. Pilot samples of our oils have already successfully passed a series of tests for compliance with the requirements of leading European car manufacturers in the German technology center ISP. In testing, our products were compared with foreign counterparts. I want to note that there has never been such an approach in Russia - these are the first domestic base oils that have passed such tests, proving high quality. The results obtained allow us to start a dialogue with equipment manufacturers. At the same time, it is important to understand that the capacity of YANOS (106 thousand tons of base oils of the third group) is only the first step. We will consistently increase the capacity for the production of synthetics - by 2021, the Omsk plant will be ready to begin production of oils of groups II and III.
Does the quality of our products compete with foreign manufacturers not only on the Russian, but also on the international market?
We want the Russian product to be accepted by global automakers. To this end, we have joined the association of oil manufacturers ATIEL - this is a closed club of the twenty largest market players, such as Mobil, Shell, BP, Total, and others. For us, this is an important institutional change. Membership in the association allows the company to work directly with automakers and participate in the development of new industry standards, which gives us the opportunity to significantly accelerate the introduction of products to the market. For global automakers, we still produce oils using Western components, but we have a task to replace these components with Russian ones - for this we work in an association.
Last year, we were able to introduce new production technologies, expand the company's product portfolio with innovative products, and also enter new challenging market sectors. The result of this work is visible in sales volumes and in revenue.
What products can be called the main driver of sales growth today?
In 2016, we sold 542 thousand tons of products, with more than half of the volume, namely 258 thousand tons, accounted for premium products - this modern oils, which have approvals and approvals from leading manufacturers of equipment. In the segment of premium products, we grew by 16%, the leader in terms of development is the G-Energy brand, its sales grew by 31%.
The reason for the popularity of G-Energy oils, first of all, is their quality, as well as the thoughtful marketing strategy. In order not to be unfounded, I want to remind you that for several years now our products have proven their superiority, passing extreme tests at races: G-Energy oils are poured into sports car engines, and our engineers monitor their condition in real time. This year the crew of the G-Energy Team won the Africa Eco Race rally marathon - a transcontinental marathon from Europe to Africa, passing through the impassability and sands of the Sahara desert. The MAZ-SPORTauto team (MAZ trucks) entered the top 10 of the Dakar truck standings - the athletes overcame dunes, mountains, serious elevation changes, while they had new engine, which requires a break-in. Both teams showed excellent results, which we are certainly very happy about, because no matter how good the laboratory data are, sports competitions are an absolute test of the quality of our products.
The growth in sales, of course, was significantly affected by the development of the G-Energy Service project, since the stations primarily sell G-Energy oils. Service stations operating under the brand of the project carry out maintenance and repair of various domestic and foreign cars. Last year we increased the number of stations to 70 in 9 countries. We plan that by the end of this year, about 160 stations will operate under the G-Energy Service brand.
The economic situation in the country is not easy. What is the reason, in your opinion, for the market growth of premium products against this background?
One way or another, but the various equipment purchased and used today in Russia is becoming more and more complicated. Accordingly, such machines require the use of more technologically advanced oils. And now we are seeing a growing demand for semi-synthetic and synthetic oils. Our research shows that the Russian market has fixed on a certain volume of consumption, but the market structure itself is changing towards high-tech products, this niche is growing. This trend is seen by all market players, so global manufacturers have begun to create production facilities in Russia, for example, Shell opened a plant in Torzhok, Total produces oils at outsourcing facilities and received a site for its own construction. There are plans for the production of other manufacturers. The Russian market remains very interesting for global players - competition is growing precisely due to the scientific and technological components.
In this regard, I consider one of the breakthroughs for Gazpromneft-Lubricants to be the start of the work of the R&D (research and development) division, which was formed not just as a center of competence, but as a division with its own funding, staff and tasks to implement specific steps within long-term strategy of the company. We will continue to invest in this area, because the products that we plan to offer to the Russian market are precisely high-tech oils with high operational characteristics.
The product range of Gazpromneft-SM includes more than 500 items
In September 2016, Sibirskaya Neft wrote about entering new segments of the lubricants market thanks to the acquisition of Rospolikhim. How is the asset developing now?
The integration of Rospolikhim into the company allowed us to start working in the segment of oils for aviation and navy, expander oils for pipe rolling and plasticizers for the chemical industry. At the same time, it is important that we have received management of the production of saturated esters as a raw material for oils of the fifth group, from which we will produce much more products than this asset previously produced.
We want to expand Rospolykhim's product range with consumer oils and various high-tech products, such as additives, solvents of various types, plasticizer oils for the plastics industry, expander oils for the pipe industry, complex compressor oils, turbine oils, which are produced using only the fifth group base oils. These products are produced in Russia, but today the advantage lies with imports (for example, only 25% of expander oils are domestic production). This is despite the fact that Russia has raw materials. We used to sell it abroad, where we produced complex oils, which were then imported into Russia. But, of course, it is much more profitable to produce these products yourself.
We also started developing an oil thickening additive, which is not currently produced in Russia. Today it is 100% import. In fact, we have resumed the production of thickener additives in Russia, only at a new technological level. The volume of production will be sufficient to meet both our needs and, probably, more than half of Russian consumers - we expect to satisfy the needs of up to 70% of the market in thickening additives.
What efforts are required from the company to integrate such an asset as Rospolikhim?
The fulfillment of all our plans is impossible without the modernization of production - a lot of the equipment at Rospolykhim has been operating for about 10 years. In addition, we are implementing Gazprom Neft reliability standards in the field of industrial safety. We will also change our attitude towards the ecology of production. Now the asset is preparing for environmental and industrial safety certification - this will take several years, since the single certification body that audits all our sites - the Swiss company SGS - has high requirements, and the asset requires investments in ensuring production quality control. At the same time, we have already integrated the enterprise into our raw material supply system (we now supply some of the necessary components from Yaroslavl and Omsk) and transfer it to our quality control management system.
We are in dialogue with the government Nizhny Novgorod, which offered us options for industrial sites for further expansion. By the middle of the year, projects for expanding production will be prepared.
This year, the crew of the G-Energy Team won the Africa Eco Race rally marathon, and the MAZ-SP ORTauto team entered the top 10 of the Dakar truck standings. Both teams showed excellent results and this is an absolute test of the quality of our products.
We have signed agreements on cooperation in the field of import substitution of lubricants with a number of regions. Based on these agreements, our technical specialists constitute single cards lubricants for enterprises, study what approvals from equipment manufacturers are needed for work, and offer our product that fully meets these requirements and provides savings due to the purchase of lubricants in rubles. Thanks to cooperation with us, some regions have reduced import dependence by 67% by switching to Russian products, while obtaining oils with the necessary high performance characteristics and providing reliable performance technology.
Are we talking only about the municipal enterprises of the regions?
Not only. First of all, we work with municipal and federal customers, and then we offer our services to all enterprises in the regions. This work, of course, has a social aspect, because with our oils it is cheaper to service passenger transport, urban infrastructure, which indirectly becomes a deterrent to the growth of tariffs for the population. We are also interested in working with businesses. We will develop the import substitution program further - the share of imports of lubricants in Russia is still high - according to our estimates, about 25%.
What criteria are used to select regions?
We go on request from the regions themselves. The most prudent owners know how to count money and are themselves interested in reducing import dependence. They are attracted by the speed of shipments, which we can provide, and the terms of payment. This year there will be new agreements, a number of regions have expressed their willingness to cooperate.
What are the market ambitions of the company in 2017?
I am pleased with the results of the past year, but, as always, I would like more. We have a very high potential in the premium lubricants segment for the Arctic, and we are investing heavily in these developments. In 2017 we will introduce to the market synthetic lubricants from own raw materials; we also plan to expand the range of synthetic oils based on our own base oils. oils III and V groups, and bring to the market an additional 30 thousand tons of synthetic products. These are all plans for premium products. Also in 2017, we will develop the G-Energy Service network and continue to work with dealer service stations of leading automakers. Trust in our brands is growing and we will continue to build momentum.
Gazprom Neft - Lubricants
A subsidiary of Gazprom Neft specializing in the production and sale of oils, lubricants and technical fluids. Created in November 2007. The company has 6 production sites in Russia, Italy and Serbia. The total production volume exceeds 500 thousand tons high quality oils, lubricants and technical fluids per year. The company supplies products to Russian conveyors DAIMLER KAMAZ RUS, KZ ROSTSELMASH, AK DERVEYS, KAMAZ, AVTOTOR (Hyundai conveyor), AZ GAZ, UAZ (Sollers), BELAZ. Consumers of products are also Severstal, Sibur, Gazprom, Evraz, MMK, TMK, NLMK, Rusal, Alrosa, Russian Railways and other major industrial enterprises. The range includes 500 types of oils and lubricants for all market sectors (more than 1200 commodity items).
The company's products have over 250 approvals from leading equipment manufacturers: BMW, Mercedes-Benz, Volkswagen, Volvo, Renault, General Motors, Cummins, MAN, ZF, KAMAZ, Avtovaz, Bosch Rexroth, etc. The company is also engaged in the production and sale of marine oils, supplies products for ships of Sovcomflot, Rosmorport, Rosnefteflot and other Russian and foreign shipowners. Through integration into Chevron's global supply network, the company's customers can source marine oils from more than 800 ports around the world. Gazpromneft-SM occupies 15% of the lubricants market in Russia, and also operates in the CIS and Baltic countries, Europe, Central and Southeast Asia, Africa, etc. In total, the company's products are represented in more than 60 countries around the world.
