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Bangladesh Flooded With So-called Synthetic Engine Oils

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Zulker Naeen
Bangladesh Market Flooded With So-called Synthetic Engine Oils

The vehicle owners should be careful before choosing synthetic oils. Recently, so-called synthetic engine oils are flooded in the market.

For purchasing lube, majority owner’s takes advice from the retail shop and sometimes from the mechanics. There is a big chance of miss appropriations of the synthetic oils then.

Choosing a right oil not only depends on the recommended grades. It also depends on the car type, car age and driving environment, and fuel quality.

The use of quality fully-synthetic or mineral oils can improve the fuel economy by decreasing engine friction.

For your hybrid cars, choosing engine oils mostly depends on the ambient temperature. Also, you should consider the fuel condition in this matter.

In our country, fuel adulteration and traffic cannot be managed over the night. But you should be aware of the discussed issues while choosing the right oil form right place.

It Is Difficult To Judge Lube Oil Quality

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Zulker Naeen
It is difficult to justify lubricants oil quality

Engine oils are made as per the standard specification for particular uses. Do we know that the specification does not indicate the performance of the engine oil?

We should know that many engine oils are claiming the same standard specification; however, those product doesn’t contain that.

Such poor quality products are available for reasons of our ignorance.

Unfortunately, good quality and poor quality engine oil both looks like same in physical sight. And it is very difficult to justify the oil quality at sight or practical uses.

The automakers recommended different engine oils based on the performance or viscosity grade. It is difficult for us to choose good performing oil analyzing those grades because different lube oil blenders follow the secret formulation to make oil.

The oil performance varies on the formulation and know-how experiences. The automotive and heavy-duty diesel industries are updating their trends.

Lubricant formulations are also changing to meet the main factors such as emission regulations, oil drain intervals, and fuel economy.

Consumer Insights: Passenger Car Oil Market of Bangladesh

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Zulker Naeen
Consumer Insights of Passenger Car Oil Market of Bangladesh

Our research team has carried out a small survey with few retailers across Dayaganj, Banglabazar, Mohammadpur, Gabtoli, Bangla Motor, and Mirpur area to get a better understanding of the consumer insights of the passenger car oils.

Few interesting insights have found:

The car owners are most concerned about the quality of the lubricating oils. They don’t want to take a risk using poor grade oil for their cars. That is why they mostly choose the known branded products with a belief that their product is good.

Price is the second decision-making criteria that customers consider when buying lubricants. The car owners do not bargain much with the retailers when buying lubricants. They assume that they are getting an excellent quality product for the price they are paying.

Especially, the drivers and auto mechanics often argue and negotiate with the retailers to decide upon a price.

In contrast, in Gabtoli, Banglabazar, and Dayaganj area, customers are more doubtful about the product quality as the market is flooded with various lubricants oil brands.

According to the retailers, most car owners are not knowledgeable about the quality lubricants. They purchase products by the brand name like Mobil, Castrol, British Petroleum (BP), and Shell.

However, the auto mechanics purchase many other brands because of the pricing and to meet the company offer.

Lube Industry Needs Govt. Intervention To Ensure Quality

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Oil and Gas
Lubricants oil industry needs government intervention to ensure the quality.

The annual domestic demand for lubricating oils is increasing significantly, it’s around 100 million litres, whereas base oil demand around 140 million litres including process oil. The market value of base oil around $133 million.

However, nearly 50 per cent of lubricants oils are low in terms of quality.

In our country, there are few lubricants oil manufacturers, which are blending non-standard engine oil by mixing some virgin base oil with recycled base oil, which damages equipment worth million USD every year.

Recently, in 2018, a survey observed that the lubricating oil is being imported through under-invoicing to enjoy price benefit. As a result, the government is losing its yearly revenues.

This industry needs government intervention to ensure the quality of engine oils to save national wealth.

Government standard regulations and proper monitoring can only control the increase of low-quality lubricants market growing trend.

Base Oil Market Is Eyeing Growth In Bangladesh

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Zulker Naeen
Base oil market is eyeing growth in Bangladesh

The market size of the base oil is expected to increase in Asia-Pacific, due to the economic growth in the nations such as South Korea, China, Bangladesh, and India.

The demand for base oil is the highest in the automotive industry, holds over 57 per cent of the total market, in terms of volume.

The growing use of the electric vehicle in developing countries is driving the demand for lubricants,  in turn, which is creating the demand for the lighter grade base oil to produce lower viscosity or thinner oils.

The demand from the industrial machinery and equipment application also accounts for a major share of the total lubricants market and is driven by the end-user sectors such as power, manufacturing, logistics, automotive manufacturing, and others.

Lubricants Oil Market Is Laden With Low-quality Products

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Zulker Naeen
lubricants oil market is laden with low-quality products.

Nearly 65 per cent of barrel oils, especially the monograde oils are low in terms of quality.

These are being produced from the recycled base oil, low-quality base oil, or sometimes from the straight mineral base oil without mixing any additives.

Recently, in 2018, a survey observed that the lubricating oil is being imported through under-invoicing to get price benefit. As a result, the government is losing its yearly revenues.

In Bangladesh, a huge amount of processed base oil is being imported every year for rubber industries, which is not fit for the lubricants oil. However, traders are reforming this processed base oil into low-quality lubricants, which are cheaper in terms of price.

This is how lubricants oil market is laden with the lower quality products.

Bangladesh Lubricants Oil Market In Backward Move

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Bangladesh lubricants oil market in a backward move
Bangladesh lubricants oil market in a backward move.

Bangladesh is going backwards, whereas the global base oil market is shifting to high-quality oils to meet the requirement of the modern machinery.

In Bangladesh, nearly 45 per cent market of the barrel oil segment is captured by low-quality lubricants.

These are being produced from the recycled base oil, low-quality base oil, or sometimes from the straight mineral base oil without mixing any additives.

The additive less mineral base oil is strictly prohibited to use as an engine oil.

Few lubricants oil manufacturers are blending non-standard engine oil by mixing some virgin base oil with recycled base oil, which damages equipment worth million USD every year.

The low-quality engine oil is a big concern now.

Lubricants Shelves Have No More Space To Place New Brand

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Zulker Naeen
Lubricants shelves have no more space to place your new brand now

Lubricants shelves have no more space to place your new brand now. You might get surprised hearing such a statement. For your information, It is not a surprising one.

Bangladesh Lubricants Oil market has become more overstated in terms of brand names and local products.

A national sales manager, of a reputed lubricating oil brand in Bangladesh, said, even India doesn’t have too many oil brands like Bangladesh have.
More lubricants oil brands are yet to enter Bangladesh.

In 2017, Bangladesh Energy Regulatory Commission released that, “Around 350 application has been filled to open LC for importing abroad oil brands”
Now, lubricants oil retailers are welcoming the representatives of newly entered brands.

It can be said that the situation is being tough for the overall market. Existing lubricants oil brands with small market share, are struggling to hold their market shares.

Why Lubricants Oil Brands Are Losing Market Share In Bangladesh?

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Zulker Naeen
Why lubricants oil brands are losing their market share in Bangladesh

Branded barrel oil, especially the 205-litre monograde oils are facing a hard time because of the unauthorized local brands.

Many unauthorized and irregular barrel brands are available in different names in different areas of Bangladesh. Even the users don’t know about their quality. Lubricants oil sellers sell those low-quality products to make the profit.

How irregular brands are making their barrel oils? Mostly these local brands depend on the toll blenders, which has created an open field to make their products. It has liberalized an uneven practice, thus created an opportunity to do oil business for the local blenders.

Already, more than thirty local brands hold their space in different regions and progressively they are making their product regular. In such a way, branded barrel brands are losing their market.

Earlier, we have identified this issue as a forthcoming peril for the existing popular lubricants brands. Many lubricants oil brands are struggling now to enjoy their brand values and gradually losing their market shares.

Lubricants Oil Brands With Little Market Share In Threat

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Lubricating oil
Lubricants oil brands with little market share in threat

Bangladesh lubricants oil market is now in a transformed nature, because of various newborn key factors. Those key issues are being ignored by many lubricating oil companies with a small market share.

The market already holds more than a hundred oil brands. Still, upcoming companies are being interested to inject more brands hoping it is an open market.

But we should remember, it is an open market to enter, but very difficult to create loyalty for our brands.

The annual domestic demand of lubricating oils is increasing significantly; it’s around 100 million litres, whereas base oil demand around 140 million litres.

Existing brands are gradually losing their little market shares, and they don’t have that exact reasons why they are losing it. It is high time to understand the changing market to sustain. They should rephrase their business strategy with proper market positioning.

The more traditional strategy they follow, the more market share will be in a threat.

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