Hydraulic Oils - Technological Advancements Determine Demand
It should be interesting to examine the basis of the argument. Rapid mechanization of construction activities in the country is making it increasingly necessary to deploy equipment at sites that are truly workhorse in their entity. In sync, there are obvious requirement of equipment that have lesser oil drain out intervals during the entire job cycle. Further basis to the argument is added by the fact mechanization is bringing in requirements of equipment that are technologically refined.
Value being the major determinant, Valvoline produces hydraulic oils that have chemical composition comprising 'mineral oils+ anti rust+ antioxidant' (MO+ AR+ AO) additives. Mr. Mishra says, "We are among the few oil companies in India who supply as standard offering, hydraulic oils that have combination of MO+ AR+ AO+ Viscosity Index Improvers (VII)". The characteristic of VII additive is that with change in external and internal operating temperature of the equipment, the viscosity of the hydraulic oils does not change thus allowing the hydraulic systems of the equipment to function effectively at all working temperatures.
Valvoline hydraulic oils systems meet the latest ISO and DIN certifications. The US origin company also produces 'super clean hydraulic oils' based on NAS variants and is in the select few companies which can give NAS 6 levels super clean hydraulic oils. Valvoline claims to have a good percentage of market share in hydraulic oils among other private producers having combined market share of 55%. The public sector producers have 45% share for the specialized oil in the country.
With value playing the major role in demand, pricing is not the determining factor in hydraulic oils sales, maintain hydraulic oils producers. However, retention of market presence requires to be adequately backed by customer support for sustained equipment uptime. Customer support has to be through assistance to determine wear and tear of the fed parts consuming hydraulic oils. According to Mr. Mishra, "we have recently started offering to our customers a unique portable oil sample testing device for our customers. The item is given to customers as part of the value package. It is much helpful for equipment working at remote job sites as it can help in testing oil samples without sending it to the laboratory for preventive maintenance."
Valvoline has three laboratories across India for oils sample testing – the central lab in Mumbai while two regional labs in Asansol and Coimbatore. The company has many OEM approvals which help it in being a preferred supplier in the market.
Distribution of the hydraulic oils by Valvoline is carried by its 46 carrying and forwarding agent (CNF) across the country, with 1 CNF in each state. The CNF caters directly to the institutional sales. There are 700 distributors and 32,000 retailers. Valvoline's existing blending facility for the hydraulic oils is in Panvel, Maharashtra with capacity of 100 million liter. To have larger market presence, it is setting up a new facility at Ambernath near Kalyan also in Maharashtra with a capacity of 150 million liter per year. Stated to be one of the largest blending facilities in India by Valvoline, production is expected to start from September 2012 in the new facility.
Valued Multiple OfferingsValue proposition in hydraulic oils is provided by PSU producing major Indian Oil Corporation. IOCL makes its hydraulic oils available under "Servo" brand. Servo hydraulic oils are available under Servo System HLP Series (VG 32,46,68,100 & 150) premium AW hydraulic oils. The oil meets denison HF-0 and DIN 51524 part-2 specs. Other variants of hydraulic oils includes, 'Servo Hydrex Series' (VG 32, 46, 68 & 100) high viscosity index anti wear hydraulic oil. It meets E & F specs and DIN 51524 Part-3 Specification. As per IOCL, Hydrex series meets requirements of L&T Komatsu excavators.
IOCL enjoys its heightened market position based state-of-the-art, ISO quality systems certified blending plants for hydraulic oils across the country. The major plants are located at Paharpur ,Budge- Budge, Trombay near Mumbai, Chennai, Asauti near Delhi, Silvassa and Vashi (grease plant only). IOC also has 12 small can blending plants to meet the demand. IOC's large production infrastructure backed by CFA and stockists helps to serve bulk and non bulk customers equally and adequately.
He points out, "our marketing division has a full fledged technical services department at our head office in Mumbai and field engineers are posted in 16 state offices across the country to provide required support to customers. Our four customer service laboratories (one in each region) are available for testing customer's lube oil samples for issues related to troubleshooting and condition monitoring." He says, "IOCL's state-of-the-art R&D centre at Faridabad is associated with the development of tailor made hydraulic oils for various segments. It has been instrumental in developing novel in house formulations for import substitutions in line with international specification standards."
The PSU is having more than 30,000 touch points and stockists for distributing its hydraulic oils formulations. Indian Oil Corporation also has its presence in additives through its 50: 50 joint venture equity with Lubrizol US. IOCL also has a separate joint venture with Chevron through its fully owned subsidiary Chennai Petroleum Corporation Limited. The joint venture company is Indian Additives Limited.
Additives are the essential constituent for hydraulic oils. Hydraulic oils are formulated with base oil and additives. Additives are added to base oils based on requirement for each type of hydraulic oils engine oils and gear oils.
He informs, "Total produces HLP, HVLP, super clean, fire resistant and ash free products. These are composed of different base components. The range of Total products highlights the top selling product like Azolla ZS (HLP and Super Clean), Azolla AF (Ash free HLP), Acantis HM (HM Grade), Equivis ZS (HVLP) and Hydransafe (Fire resistance). The drain out intervals varies according to OEM's. However, in general it is expected to work beyond 2000 hours even in critical applications."
Mr. Velappan adds, "Total products are approved by many OEM's. To name a few, Sany, Liugong Liebherr, Arburg, ferromatic Milacron, Engel, Nestal, Schuler, Battenfeld, Boy, Windsor, Sachmi, Sauer Danfoss, Bihler, KHS, Eaton, Denison Hydraulics, Krones, Muller."
Total's production facility is based at Mahape, Mumbai where it has more than 100,000 MTPA with tank farm storage facilities. "The tank farm area (TFA) is provided with various levels of protection methods; against overflow, contamination, moisture ingress, fire protection and environmental pollution elimination to maintain product quality. The TFA has currently > 15 base oil/additive tanks and finished product tank. Set of blenders (agitation type) of various capacities, designed on the basis of LEM concept, a patented design from the elf stream. Blending is carried out at an elevated temperature range.tells Mr. Velappan. The company claims to have minimum lead times in making lubricants available to our customer site with the back up of > 500 depots across the country.