The economics of synthetics

G-MAN · Feb 10, 2003

Evaluating the quality of a finished synthetic has sometimes been tied to the retail price of the oil. On some Amsoil dealer sites, you'll read about the cost to produce their oil and the expense of the ingredients used. The level of expensive esters in Red Line has been mentioned on this forum in relation to the retail price of that oil. And when it comes to Mobil 1, it has been hinted that perhaps Mobil's desire to compete in the OTC market and keep costs down determines the "quality" of the ingredients used to make Mobil 1. Are these valid ways of looking at the overall quality of what goes into making a company's synthetic oil? I don't think it is.

The SIZE of ExxonMobil with its vast production capabilities for various PAOs and esters would tend to be a big plus in enabling them to use the very best ingredients while keeping the retail price at the lowest level possible. Therefore, I'd be willing to bet that ExxonMobil could produce a synthetic oil with a base oil comprised of 40% esters and 60% PAO much more cheaply than Red Line could produce the same oil. This would of course translate into a lower retail price than Red Line would have to charge.

Of course, the best way to evaluate any oil is to use it and test it. But trying to evaluate the quality of a synthetic based on price is like comparing apples to oranges when it comes to saying that Brand X is better than Mobil 1 because it costs more. The economics of proudcing sythetics just don't work that way.

buster · Feb 10, 2003

quote:

The SIZE of ExxonMobil with its vast production capabilities for various PAOs and esters would tend to be a big plus in enabling them to use the very best ingredients while keeping the retail price at the lowest level possible. Therefore, I'd be willing to bet that ExxonMobil could produce a synthetic oil with a base oil comprised of 40% esters and 60% PAO much more cheaply than Red Line could produce the same oil. This would of course translate into a lower retail price than Red Line would have to charge

I absolutely agree. Economies of Scale is what your looking for. (I was and Econ major...surprised I remember this)

economy of scale
Reduction in cost per unit resulting from increased production, realized through operational efficiencies. Economies of scale can be accomplished because as production increases, the cost of producing each additional unit falls.

This is a very good point G-Man. Just bc Mobil CAN sell at Retail levels, does not mean they are cutting costs, therefore quality, to do so. Amsoil/Redline cannot handle the volume of Mobil so they can't afford to do the same. Amsoil can't even put a group IV on the Retail market. Doesn't mean there oil is bad, it just means they don't have economies of scale like Mobil does. Like I said before, all Amsoil does is load up there oils with zinc (which also why they are not API Cert.) and market them for long drains.

[ February 10, 2003, 05:51 PM: Message edited by: buster ]

G-MAN · Feb 10, 2003

quote:

Originally posted by buster:
economy of scale
Reduction in cost per unit resulting from increased production, realized through operational efficiencies. Economies of scale can be accomplished because as production increases, the cost of producing each additional unit falls.

It's more than just this, too. Red Line and Amsoil have to buy their base oil ingredients from someone else. Mobil doesn't. Your retail price point is going to be lower if you produce not only the finished product, but the ingredients needed to make it.

Terry · Feb 10, 2003

All the above being accepted, IMHO I still see better oil analysis results ( lower wear values) with otc Redline, Euro spec Castrol, Royal Purple synthetics than I do with tri-syn, now super syn.

I honestly don't think Mobil is giving the M1 customer the best they have as far as wear protection. Heck Schaeffers 7000 Blend will give better wear values in 5000 mile or less intervals than alot of more expensive oils.

buster · Feb 10, 2003

Terry, that could be very well true. If anyone would know this, it's you. Mobil's additives are in house so we are not comparing apples to apples. But, in terms of cost analysis, Mobil has the advantage over the other companies IMO.

[ February 10, 2003, 06:45 PM: Message edited by: buster ]

G-MAN · Feb 10, 2003

quote:

Originally posted by Terry:
All the above being accepted, IMHO I still see better oil analysis results ( lower wear values) with otc Redline, Euro spec Castrol, Royal Purple synthetics than I do with tri-syn, now super syn.

I honestly don't think Mobil is giving the M1 customer the best they have as far as wear protection. Heck Schaeffers 7000 Blend will give better wear values in 5000 mile or less intervals than alot of more expensive oils.

I don't think I agree with this, at least not completely. I've not seen any really bad SuperSyn UOAs posted here, and I don't think I've seen any back to back comparisons of SuperSyn to any of the oils you mentioned where the only variable was the oil. As for Red Line, with the exception of the most recent UOA posted, their results have appeared somewhat mediocre at best.

Al · Feb 10, 2003

Well with my very limited expertise I would have to agree with Terry. A year ago I was a truly diehard Mobil1 guy and used to argue with Bob on the Edmund's board.

But the more I argued the more I personally began to feel that there were better oils out there. I think that in general Amsoil puts up better numbers than Mobil. The jury is out for me on Shaeffer's, Redline and Royal Purple. Believe me I have read and re-read all the SAE publications that Mobil has published. I do think though that their Delvac1 oil may be the best oil bar none. Hey-just trying to keep an open mind.

Terry · Feb 10, 2003

G-man II, I understand your doubt but Ed P's oil board is not the only oil analysis testing source I interpret daily.

For instance the Schaeffers 7000 Blend 5w-30 will garner better wear values in equal duration testing , (
Many of my PCMO customers have taken this route with excellent results.

I like Super Syn.... after I doctor it with some #132 and LC to provide that buffer mentioned above.

I think a easily verifiable case in point is that within months of SS intro in the US market they began adding Moly for just the reasons I am concerned about, instead of using MORE of the Esters needed to provide a barrier that a Castrol RS synthetic renders "molyless".

Is Super Syn a good lube, sure it is, even better with Moly.

Just an opinion..

G-MAN · Feb 10, 2003

quote:

Originally posted by Terry:
I think a easily verifiable case in point is that within months of SS intro in the US market they began adding Moly for just the reasons I am concerned about, instead of using MORE of the Esters needed to provide a barrier that a Castrol RS synthetic renders "molyless".

A couple questions: Given the physics of how boundary protection additives seem to work, how can an ester alone function as one? Also, are you saying that Castrol RS oils have relatively heavy doses of ester in the base oil blend? (Given a 10-60 spread, this wouldn't surprise me, actually.)

GROUCHO MARX · Feb 10, 2003

Mobil has a competitive advantage. This does not mean that their economic advantage is passed along to the consumer with a better value.

YZF150 · Feb 10, 2003

quote:

As for Red Line, with the exception of the most recent UOA posted, their results have appeared somewhat mediocre at best.

Is this really the case? Are Red Line's analyses mediocre? What would make them better?

YZF150 · Feb 10, 2003

What incentive does Mobil have for improving upon their current products, in terms of viscosity stability and longevity? They're doing a bang-up volume business. If their oils held up better, they'd sell fewer units per unit time. As it is, their products do provide good protection and they clean engines well, despite the "thinning out" quality that they have. So, knowledgeable users simply change their oil more frequently and keep coming back to Mobil. Those not so knowledgeable, or those who are otherwise not interested, simply run it on faith. An all-around excellent position to be, in the market as a whole.

Terry · Feb 10, 2003

G-Man, certainly esters can function as a mixed and boundary layer lube/ep alone or more commonly with very low levels of other more traditional adds , just not cheaply.

The chemists here can help explain the how exactly, I just see the results.

Shame on Castrol for not marketing those products here.

This is exactly how we are bringing down the phos levels and keeping wear in check.

The Castrol RS definitely relys on the base ester oils for this function. the phos is in the 600 ppm range, Calcium 2200 ppm, Zinc 750, Magnesium
Another interesting development is the overbased calcium that Oil Extreme uses, that plates and coats for EP protection, also provides very good friction reduction in fluid flow/seperation issues.

dragboat · Feb 10, 2003

It looks like the Amsoil as edged out here by the Mobil Supersyn in the same vehicle,same driving pattern. A bit more miles on the Amsoil but there was also a entire quart of make-up oil.

Amsoil in Nissan
http://theoildrop.server101.com/cgi/ultimatebb.cgi?ubb=get_topic;f=3;t=000110

Mobil Supersyn in Nissan

http://theoildrop.server101.com/ubb/ultimatebb.php?ubb=get_topic;f=3;t=000158

You guys be the judge in case I missed something here

[ February 10, 2003, 10:35 PM: Message edited by: dragboat ]

dragboat · Feb 10, 2003

And I did miss something,look at all that Phos and Zinc in the Amsoil,,that is no SL oil there.

I think Mobil is close to GF-4 with their oils without loosing much in protection.I also believe they have given the USA a great oil for all but racing at a moderate price.Giving us what we want and what we need might be two different stories. JMO...More on that later

G-MAN · Feb 10, 2003

quote:

Originally posted by dragboat:
And I did miss something,look at all that Phos and Zinc in the Amsoil,,that is no SL oil there.

I think Mobil is close to GF-4 with their oils without loosing much in protection.I also believe they have given the USA a great oil for all but racing at a moderate price.Giving us what we want and what we need might be two different stories. JMO...More on that later

Thinking about what Terry said, it looks as though Mobil may indeed be relying on high-tech esters (with a little moly) for wear protection, whereas Amsoil is still taking the "old fashioned" route by just loading the oil up with zinc and phosphorous.

M Smith · Feb 10, 2003

G-Man II; where in SC are you from?

G-MAN · Feb 10, 2003

quote:

Originally posted by M Smith:

G-Man II; where in SC are you from?

The Upstate. You? (I would have PM'd you with the answer, but I see you're not accepting PMs.)

VeeDubb · Feb 10, 2003

quote:

Originally posted by Al:
Well with my very limited expertise I would have to agree with Terry. A year ago I was a truly diehard Mobil1 guy and used to argue with Bob on the Edmund's board.

But the more I argued the more I personally began to feel that there were better oils out there. I think that in general Amsoil puts up better numbers than Mobil. The jury is out for me on Shaeffer's, Redline and Royal Purple. Believe me I have read and re-read all the SAE publications that Mobil has published. I do think though that their Delvac1 oil may be the best oil bar none. Hey-just trying to keep an open mind.

Funny, that's exactly how I felt about Mobil 1 until I started frequenting this board. In fact, I've been more impressed with some of the dino oil results (e.g. GTX). The only reason why I would consider Mobil 1 at all now is because I have a turbo, but if I didn't, I'd probably run GTX and just do 3 or 4k drains.

TooSlick · Feb 10, 2003

The best products mobil makes are probably Delvac 1, 5w-40 and their 10w-40/20w-50 "motorcycle" oils - these also happen to be $5.50-$8.00/quart. In addition, since these are xw-40 and xw-50 oils, they aren't limited in the amount of ZDDP they can use, so they provide better extended drain performance.

If you do a baseline analysis of Amsoil and Mobil 1, you'll see that Amsoil uses significantly higher levels of antiwear and detergent/dispersant additives. Both oils use similiar PAO/Ester blended basestocks, so it is really the difference in additive chemistry that sets them apart.

I think that Mobil does a very good job, given that they are formulating to a "price point" of $4.00-$4.50/quart, and are making a licensed formulation with low levels of ZDDP. However, I also think that both Amsoil and Redline make better "cost is no object" formulations for long drain intervals. It is very rare to find anyone using Mobil 1 for more than 7500 miles, whereas 90% of my retail customers run drains longer than 7500 miles - in some cases several times as long. So these oils are really serving two distinctly different markets ....

TooSlick

The economics of synthetics

Similar threads