LOCAL REPORT Germany Paul Stephenson, OATS Ltd
The economy Germany’s economy has been hit with further outbreaks of COVID-19 via the Omicron variant, and now faces turbulence with the Russian invasion of Ukraine. The forecasts from the European Economic Forecast Winter 2022 of 3.6% GDP growth and 3.7% inflation now look high and low respectively. According to Trading Economics, inflation has already hit 5% in the last four months. Crude oil prices are at a decade level high.
The passenger and light commercial vehicle parc and developments According to the UEIL 2021 Industry Statistics report, Lubricant sales decreased sharply in 2020, with total sales falling from 976,000 to 787,000 metric tonnes. Most of this decrease came from industrial sales, with the automotive market remaining stable. Nevertheless Germany continues to be the largest lubricants producer in Europe.
The German auto industry still also dominates the German and European markets, although in 2021, there was a reduction of 10% vs 2020 of new vehicles registered in Germany. 26% of the 2.6m registered were electric, with BEV growing by 11% and PHEV declining by 16% and some €220bn is being invested by the whole industry into electromobility between 2022 and 2026 according to the VDA.
In the German parc up to December 2020, nearly 26m were produced by VAG, MB, BMW & Porsche representing 54% of total vehicles in operation (VIO). If you add Opel and Ford to this, it gets close to 70%.
The VAG and MB models which offer more than 1m litres of oil annually are VW Golf, Polo, Transporter, Passat, Touran, Caddy, Tiguan & Multivan and MB A,B,C & E-Class, Sprinter 3.5t and Vito.
Germany has also enacted the first legislation anywhere in the world to legalise autonomous driving. The start-point will be limited to valet parking and hub to hub truck routes within a facility, but it is certainly the start of an exciting new chapter.
Base oil
Germany continues to be totally dependent on imported crude oil and will be seeking alternative sources whilst accelerating renewables.
The major oil companies are exiting or converting refining operations into renewables. Shell Rhineland Wesseling complex is changing to produce hydrogen, sustainable aviation fuel and bio LNG. BP Lingen is developing a zero-carbon hydrogen project to produce 9000t/year with 50MW electrolyser. Hydrogen is being seen as the best green energy source for long distance HD transportation.
Lubricants
In 2020, Germany’s market for automotive lubricants was approx. 355m litres - a small increase on 2019, whereas most of the other major markets declined. Engine oil continues to dominate the market, accounting for 67% of consumption in 2020, but DCT and CVT Transmissions are driving Transmission oil volume due to higher capacities.
In Light Duty, five out of the top 10 specifications by volume are VW gear oils – VW 52182, 52527, 52171, 55512 and 55529 and three are Mercedes Benz ATFs – 236.14, 236.15 and 236.17. GL-4 continues to be an important specification with 20% of 2020 registered vehicles still calling for it.
In terms of engine oils, the Light Duty specifications being used in Germany are the latest ACEA specifications for grades such as C3, C5 and C6 for low ash requirements and A3/B3/B4 for other engines. For Heavy Duty, the industry awaits the release of the ACEA E8 and E11 to replace E6 and E9 and other grades which remain current.
In summary
Disruption. Innovation. Huge investment in energy security and zero-carbon.
LINK
www.oats.co.uk
LUBE MAGAZINE NO.168 APRIL 2022
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