 "We see a more rapid adoption of leading edge lubricants in India: Nitin Prasad")
Shell Lubricants has been present in India since 1993 – first through a JV with Bharat Petroleum and then as 100% subsidiary of Royal Dutch Shell since 2007. Shell sells a wide variety of lubricants to meet customer needs across a range of applications. These include consumer motoring, heavy-duty transport, mining, power generation and general engineering. Shell’s portfolio of lubricant brands includes Shell Helix, Shell Rimula, and Shell Spirax.
In this interaction with Rakesh Rao, Nitin Prasad, Managing Director, Shell Lubricants, Shell India, elaborates on the changing dynamics in the lubricants market in the country and Shell’s plans to further consolidate its position in this evolving market.
Shell Lubricants has been active in India for over two decades. What transformations have you witnessed in lubricants market in India over these years?
Since our commencement in the country, we have witnessed that one of the essentials in lubricant science is world class technology. Lubricant technology is driven by the changing needs of the customers; the demand from Original Equipment Manufacturers (OEMs) and end customers for better quality lubricants with longer life, leads to technology developments in the lubricants industry.
Engineering technology has improved significantly in the past few years with a corresponding impact on the improvement of lubricant quality. Improving engine and lubricant technology has resulted in the decline in the lube for fuel ratio. As industry faces the challenges of lowering cost of production, a key requirement is to lower the operating costs and total maintenance costs. Hence, we see a more rapid adoption of leading edge lubricants that provide energy efficiency benefits and lower the total cost of ownership.
After you took over as Shell Lubricants' new India country head in October 2011, what changes you brought about in the company? How have been the results?
I have always preferred to work with a company that drives leading edge technology and creates an empowerment focused employee oriented performance culture. And that is exactly what I have tried to create in this organisation so far. In the space of technology, we continue to develop new lubricants that deliver levels of performance in terms of fuel efficiency, lower emissions and higher oil drain interval. For example, our focus on developing gas-to-liquid (GTL) based product solutions with our OEM customers.
In terms of the second area, I continue to believe that our employees are our biggest strength. We have focused on not only building a great team, but also continuously investing in the development of our wide talent base. However, a strong team also needs the freedom to innovate and to be able to deliver. Here we have focused on the culture of the organisation, increasing levels of empowerment, freedom to take risks and take ownership to achieve execution excellence. Finally, we set a clear direction to the team and clearly emphasise our role in delivering value to our customers as a collaborative partner, ie moving from a buy-sell relationship to one where we work jointly with our customers to solve the next generation of technological challenges.
I am proud to say that we have seen a measurable difference over the past few years with our customer satisfaction and employee feedback scores reaching the highest level ever and becoming best in class, best in industry. This gives me the confidence that our approach is working.
Of the various sectors catered to by Shell, which offers high growth opportunity? Why?
In India, we are focusing on nine prominent sectors namely, automotive, auto components, agriculture, power, construction, metals, mining, manufacturing and fleets. However, as we have a product portfolio that is applicable across all industries the highest growth areas are the sectors that have the highest growth potential for the broader economy. With a renewed focus on infrastructure, I am sure this will be one of the main sectors for the future and that will lead to a ripple effect of growth in automotive, steel, fleets, etc.
However, in my view, the areas that will offer the highest growth potential for Shell is in new technological advanced oils. Over the past few years, we have seen a step change in the pace of adoption of new oils that has been one of the fastest in the world. As customers continue to look for opportunities to reduce maintenance and total cost of ownership costs, lubricants is one area that has shown the ability to both increase productivity, through lower downtime, and also reduce running costs through more fuel efficient solutions.
Today, we can already see that India is looking to further reduce emissions through the newly specified CAFC standards which will drive us to beyond BSIV (Euro IV) levels. In Europe and the US, we have seen that to deliver those levels of emissions means that OEM manufacturers must examine every aspect of the car design. Consequently, lubricants has moved from being a specification based afterthought to being one of the key design considerations at the start of the development cycle and this is lead to creation of highly customised oils fit to deliver the standards required under the extreme conditions prevalent in India.
How different is the Indian lubricants market compared to other emerging Asian countries such as China, Indonesia, Thailand, etc?
The growth of the Indian lubricants industry is highly correlated to GDP growth. The per capita lubricant consumption in India is quite low compared to developed countries. However, even a comparison with other developing countries like China and Indonesia reveals that there is a significant potential for growth in lubricant consumption in India. If the economy improves further with the required investments then the entire lubricants industry is expected to witness a much positive growth in the coming years.
A big challenge which the industry currently facing is the awareness about available lubricants and right lubricant for right application. We expect increase in awareness and use of condition monitoring equipment in coming years. We will continue to see new technologies that assist in refining programs from testing lubricant properties to determining how the lubricant gets to the equipment. In India, users will continue to stress on product performance. We believe these technologies enable lubricant manufacturing companies and independent lubricant consultants to stress lubricant performance rather than price. Hence, due to increase demand for high performance products, condition monitoring and knowledge of product performance both will increase. There have been cultural challenges as well. Some OEMs and customers still perceive that thicker lubricants are better as they have grown with this old perception.
What is your outlook for Shell Lubricants in India?
Since its commencement in India, Shell has continually showcased its commitment towards customer satisfaction and value delivery by offering technology-leading product portfolio and a range of service solutions that make difference to its customer’s businesses by improving energy efficiency, lowering total cost of ownership even under the most challenging conditions. Shell has been ‘first to market’ with many lubricant innovations and the company’s commitment to research and development reflects that it is well placed to introduce the next generation of world-leading lubricants.
We have recently launched new products and will continue to build the product portfolio like the Rimula R4 which is an excellent solution at this juncture considering the evolving Euro Emission norms for commercial vehicles. We will continue to evolve semi-synthetic and synthetic oil lubricants that build on our gas-to-liquid unique properties. Finally, as the CAFC standards are evolved and platforms, fuel mixes continue to change we are already working with our OEM partners for the next generation product and service solutions that meet these requirements.
In a nutshell, we want to be reckoned as a technology & innovations leader in the Indian lubricants market, first to introduce next gen products meeting the ever evolving customer needs.
In this interaction with Rakesh Rao, Nitin Prasad, Managing Director, Shell Lubricants, Shell India, elaborates on the changing dynamics in the lubricants market in the country and Shell’s plans to further consolidate its position in this evolving market.
Shell Lubricants has been active in India for over two decades. What transformations have you witnessed in lubricants market in India over these years?
Since our commencement in the country, we have witnessed that one of the essentials in lubricant science is world class technology. Lubricant technology is driven by the changing needs of the customers; the demand from Original Equipment Manufacturers (OEMs) and end customers for better quality lubricants with longer life, leads to technology developments in the lubricants industry.
Engineering technology has improved significantly in the past few years with a corresponding impact on the improvement of lubricant quality. Improving engine and lubricant technology has resulted in the decline in the lube for fuel ratio. As industry faces the challenges of lowering cost of production, a key requirement is to lower the operating costs and total maintenance costs. Hence, we see a more rapid adoption of leading edge lubricants that provide energy efficiency benefits and lower the total cost of ownership.
Also Read
After you took over as Shell Lubricants' new India country head in October 2011, what changes you brought about in the company? How have been the results?
I have always preferred to work with a company that drives leading edge technology and creates an empowerment focused employee oriented performance culture. And that is exactly what I have tried to create in this organisation so far. In the space of technology, we continue to develop new lubricants that deliver levels of performance in terms of fuel efficiency, lower emissions and higher oil drain interval. For example, our focus on developing gas-to-liquid (GTL) based product solutions with our OEM customers.
In terms of the second area, I continue to believe that our employees are our biggest strength. We have focused on not only building a great team, but also continuously investing in the development of our wide talent base. However, a strong team also needs the freedom to innovate and to be able to deliver. Here we have focused on the culture of the organisation, increasing levels of empowerment, freedom to take risks and take ownership to achieve execution excellence. Finally, we set a clear direction to the team and clearly emphasise our role in delivering value to our customers as a collaborative partner, ie moving from a buy-sell relationship to one where we work jointly with our customers to solve the next generation of technological challenges.
I am proud to say that we have seen a measurable difference over the past few years with our customer satisfaction and employee feedback scores reaching the highest level ever and becoming best in class, best in industry. This gives me the confidence that our approach is working.
Of the various sectors catered to by Shell, which offers high growth opportunity? Why?
In India, we are focusing on nine prominent sectors namely, automotive, auto components, agriculture, power, construction, metals, mining, manufacturing and fleets. However, as we have a product portfolio that is applicable across all industries the highest growth areas are the sectors that have the highest growth potential for the broader economy. With a renewed focus on infrastructure, I am sure this will be one of the main sectors for the future and that will lead to a ripple effect of growth in automotive, steel, fleets, etc.
However, in my view, the areas that will offer the highest growth potential for Shell is in new technological advanced oils. Over the past few years, we have seen a step change in the pace of adoption of new oils that has been one of the fastest in the world. As customers continue to look for opportunities to reduce maintenance and total cost of ownership costs, lubricants is one area that has shown the ability to both increase productivity, through lower downtime, and also reduce running costs through more fuel efficient solutions.
Today, we can already see that India is looking to further reduce emissions through the newly specified CAFC standards which will drive us to beyond BSIV (Euro IV) levels. In Europe and the US, we have seen that to deliver those levels of emissions means that OEM manufacturers must examine every aspect of the car design. Consequently, lubricants has moved from being a specification based afterthought to being one of the key design considerations at the start of the development cycle and this is lead to creation of highly customised oils fit to deliver the standards required under the extreme conditions prevalent in India.
How different is the Indian lubricants market compared to other emerging Asian countries such as China, Indonesia, Thailand, etc?
The growth of the Indian lubricants industry is highly correlated to GDP growth. The per capita lubricant consumption in India is quite low compared to developed countries. However, even a comparison with other developing countries like China and Indonesia reveals that there is a significant potential for growth in lubricant consumption in India. If the economy improves further with the required investments then the entire lubricants industry is expected to witness a much positive growth in the coming years.
A big challenge which the industry currently facing is the awareness about available lubricants and right lubricant for right application. We expect increase in awareness and use of condition monitoring equipment in coming years. We will continue to see new technologies that assist in refining programs from testing lubricant properties to determining how the lubricant gets to the equipment. In India, users will continue to stress on product performance. We believe these technologies enable lubricant manufacturing companies and independent lubricant consultants to stress lubricant performance rather than price. Hence, due to increase demand for high performance products, condition monitoring and knowledge of product performance both will increase. There have been cultural challenges as well. Some OEMs and customers still perceive that thicker lubricants are better as they have grown with this old perception.
What is your outlook for Shell Lubricants in India?
Since its commencement in India, Shell has continually showcased its commitment towards customer satisfaction and value delivery by offering technology-leading product portfolio and a range of service solutions that make difference to its customer’s businesses by improving energy efficiency, lowering total cost of ownership even under the most challenging conditions. Shell has been ‘first to market’ with many lubricant innovations and the company’s commitment to research and development reflects that it is well placed to introduce the next generation of world-leading lubricants.
We have recently launched new products and will continue to build the product portfolio like the Rimula R4 which is an excellent solution at this juncture considering the evolving Euro Emission norms for commercial vehicles. We will continue to evolve semi-synthetic and synthetic oil lubricants that build on our gas-to-liquid unique properties. Finally, as the CAFC standards are evolved and platforms, fuel mixes continue to change we are already working with our OEM partners for the next generation product and service solutions that meet these requirements.
In a nutshell, we want to be reckoned as a technology & innovations leader in the Indian lubricants market, first to introduce next gen products meeting the ever evolving customer needs.