Good to see you posting on here again. I don't get my Foxtrot fill since being banned on Arf.
Valvoline’s Lubricant Product Line to be Acquired by Saudi Aramco?
- Thread starter Danh
- Start date
Good to see you posting on here again. I don't get my Foxtrot fill since being banned on Arf.
I was ironically having breakfast with a major oil company’s top lubricants leadership, when they made the announcement. So I got a very good perspective from one of the top lubricants manufacturers in North America.
Sucks you got banned over there. But I moved over here because… arf is just getting old. The politics, the mods, etc.
Major oil companies buy gallons. It's as simple as it sounds.
If you're a refiner, you have to get rid of product made, one way or another, because there is not a limitless amount of storage for your product. So the major brands will do deals, either with distributors to buy gallons, or if they have a retail outlet - i.e. Vavoline, Mobil, SOPUS products - they will run a special. A third way is large national account business. If you have a large trucking, mining, etc business - majors will buy that business via national account pricing.
Before this purchase, Motiva had no way to get rid of excess product besides cutting base oil deals / spot deals.
Now Motiva will be able to run their own brand, and do deals as they need to, as they have excess product.
The sad part is I was giving Kpel308 some crap, as he and I have talked in the past, and one of the senior mods/staff saw it and took offense and banned me even though it was just friendly banter. Stupid but whatever.
What are the rumblings about Valvoline moving forward? Does the industry see it as a good thing or do they see it getting diluted as a company/their product offerings?
Generally seen as a neutral thing. Valvoline was owned by an investment capital group that made it very clear they were only interested in the VOIC shops. The retail division was only 25% of their sales and shrinking. They had 5-6 technical staff left. And 1 of them was for coolants.
All the base oil companies are getting into finished products. Vertex (Adnoc) is blending finished product now as well.
It’s going to be a little bit of the battle of the wits of ILMAs vs Majors. But there is room to grow as total pulls back from the US, mobil continues to consolidate.
Chevron is playing a very weird game. Which no one can figure out yet. They bought Shells largest distributor in the country outside of Reladyne. And that distributor is continuing to sell Shell products… not switched to Chevron yet. And you have idemitsu lurking around the industrial end heavily. Also trying to get their marketer base in a row.
So there’s a lot of pieces currently moving. And this is just a brief update.
Interdasting.
What are you talking about? Valvoline has been a publicly traded company for the past 6 years. They are not and have not ever been owned by an investment capital group.
When Ashland spun Vavoline off to shareholders (Announced 2015) - it was a tax free transaction to the share holders.
The majority of the large share holders at the time, were venture capital groups. Elmrox Investment Group actually fought the original break up, because they valued the oil business more than the specialty chemical business. This delayed the IPO by over a year.
The decision was done to benefit certain investors, as there were several paths forward for Vavoline to stay under the Ashland Chemical flag, including just being a limited master partnership. The top 4 stock holders account for ~37% of outstanding shares. (Between their different funds.)
While being publicly traded, I probably put out a misunderstanding by saying investor capital group. I meant to say investor capital groups. Not private equity groups or private investment groups.
We saw a very similar thing happen with Timkin Steel & Bearing. When the Timkin Company split. Another similar thing when ConocoPhillips split into ConocoPhillips and P66.
I read this thread in its entirety and my opinion is thus:
A) Smart to spin off the Valvoline brand. A vast majority of folks trust their dealer, chain store, or independent mechanic to change their oil and don't care what is used.
B) Lots of folks associate Valvoline with good oil, so they'll use their oil change shops. Jiffy Lube and others don't exude the same perception of quality. 4/5 clueless car people I know use Valvoline shops and that is no joke. They associate the brand with quality, but none of these folks will buy Valvoline oil to change it themselves. If the shop has Valvoline on the sign, they'll leave with the warm and fuzzies that they did their car good.
C) Stringent API (and other) specs sort of nullify brand advantages. Spend some time on the UOA/VOA forum and Supertech or the million (slightly exaggerated) other brands produced by Warren oil, et al, compare quite favorably to the brand names we've all associated with quality. There's a certain generation of folks that hold oil brands in high regard, but they're getting fewer in number.
For Valvoline to focus on the retail side of things is a smart business decision IMO. They probably saw the writing on the wall, and figure they can make more money doing the chain thing-- which is pretty lucrative considering all the (sometimes unnecessary) services they push onto ignorant customers, and the high prices they charge for rudimentary services like brakes.
A) Smart to spin off the Valvoline brand. A vast majority of folks trust their dealer, chain store, or independent mechanic to change their oil and don't care what is used.
B) Lots of folks associate Valvoline with good oil, so they'll use their oil change shops. Jiffy Lube and others don't exude the same perception of quality. 4/5 clueless car people I know use Valvoline shops and that is no joke. They associate the brand with quality, but none of these folks will buy Valvoline oil to change it themselves. If the shop has Valvoline on the sign, they'll leave with the warm and fuzzies that they did their car good.
C) Stringent API (and other) specs sort of nullify brand advantages. Spend some time on the UOA/VOA forum and Supertech or the million (slightly exaggerated) other brands produced by Warren oil, et al, compare quite favorably to the brand names we've all associated with quality. There's a certain generation of folks that hold oil brands in high regard, but they're getting fewer in number.
For Valvoline to focus on the retail side of things is a smart business decision IMO. They probably saw the writing on the wall, and figure they can make more money doing the chain thing-- which is pretty lucrative considering all the (sometimes unnecessary) services they push onto ignorant customers, and the high prices they charge for rudimentary services like brakes.
It's definitely upsetting some folks as seen on their FB page lol. A lot of comments on this topic. I understand the frustration, especially for how old of a company Valvoline is. On a side note, they're now claiming 24x better performance than a leading full synthetic but don't state which test they are claiming it on. 
OVERKILL
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Quite apropos:It's definitely upsetting some folks as seen on their FB page lol. A lot of comments on this topic. I understand the frustration, especially for how old of a company Valvoline is. On a side note, they're now claiming 24x better performance than a leading full synthetic but don't state which test they are claiming it on.
The one selfish reason I see the move as a negative one is the price of Valvoline has increased at Wally World from 22-24 for five quarts to about 33 dollars since this news came out
I see $25.92 for a gallon of Maxlife multi vehicle.
Sad
I bought up alot of the marked down Maxlife atf quarts on Walmart.com recently and am saying goodbye to valovoline now
No I bought it because it’s old stalk marked down and I knew the deal was being made with Saudi. I got enough for next couple yearsSend them to me. $2/qt shipped.
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The use of Motiva base oils are very wide spread. Valvoline uses a lot of adnoc base oils. So going from UAE to SA.
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