- Joined
- Mar 26, 2022
- Messages
- 8
I have been reading a lot of BITOG, and have found it very informative. I do have a few questions that have not been answered: How does the OEM endorsement scheme work? How much do the oil companies have to pay the OEMs for their endorsements appearing on the back of the oil bottles? Is it a per bottle license fee? How much?
Why do I suspect that the OEM approvals on the back of oil bottles are really money-making endorsement schemes by the OEMs? Because of this: Mobil 1 is a highly respected motor oil brand that is currently selling multiple 0W20 products oriented at different markets. The M1 EP 0W20 product looks to be one of the highest quality products in the world by almost all accounts. It passes all of the US standards but has no European auto maker endorsements. M1 ESP 0W20 appears to be almost identical to EP but has many of the most revered European auto makers endorsements and is sells at three to four times the price. How much of that price is going directly to the endorsers? Since Mobil has proven with ESP that it knows how to formulate a 0W20 that can pass all of the European OEM’s tests, it obviously has the competence necessary. So why would it purposefully damage the EP product, knowing full well how to create a great oil? It seems more likely that Mobil did not do that, and instead is marketing a very similar product to ESP as EP in the US market but without the expensive endorsements.
From a marketing standpoint I can see the logic. In Germany, for example, people are famous for following rules, and endorsement from OEMs probably make all the difference regardless of price. In the US, price competition is everything, and oil companies probably have more credibility than auto manufacturers anyway. So paying for expensive OEM endorsements makes no sense.
So, did my imagination run wild and I dreamt this all up? Or is this the way things really work in the engine oil market?
Why do I suspect that the OEM approvals on the back of oil bottles are really money-making endorsement schemes by the OEMs? Because of this: Mobil 1 is a highly respected motor oil brand that is currently selling multiple 0W20 products oriented at different markets. The M1 EP 0W20 product looks to be one of the highest quality products in the world by almost all accounts. It passes all of the US standards but has no European auto maker endorsements. M1 ESP 0W20 appears to be almost identical to EP but has many of the most revered European auto makers endorsements and is sells at three to four times the price. How much of that price is going directly to the endorsers? Since Mobil has proven with ESP that it knows how to formulate a 0W20 that can pass all of the European OEM’s tests, it obviously has the competence necessary. So why would it purposefully damage the EP product, knowing full well how to create a great oil? It seems more likely that Mobil did not do that, and instead is marketing a very similar product to ESP as EP in the US market but without the expensive endorsements.
From a marketing standpoint I can see the logic. In Germany, for example, people are famous for following rules, and endorsement from OEMs probably make all the difference regardless of price. In the US, price competition is everything, and oil companies probably have more credibility than auto manufacturers anyway. So paying for expensive OEM endorsements makes no sense.
So, did my imagination run wild and I dreamt this all up? Or is this the way things really work in the engine oil market?