The Netherlands-based Shell, which is the technical partner with Formula 1’s Ferrari team, feels benefits of being associated with the Grand Prix ‘cannot be just measured in pure dollars.’ France’ Total, US’s ExxonMobil, Malaysia’s PETRONAS, Venezuela’s PDVSA are other global oil and lubricants makers betting big with Formula 1.
“F1 has lot of business benefits overall and cannot be measured in pure dollars,” Nitin Prasad, Country Head of Shell Lubricants, told Business Line .
According to Shell, the primary benefit is technological partnership. “We have an opportunity to try all our new fuels on the race track. And offer them to the market. It gives us a competitive advantage,” Prasad said.
Other includes brand recognition and a connection to customers. The companies such as Tata or Hyundai can understand the capabilities and look for tie ups to us, he added.
Shell’s ‘Helix Ultra’ motor oil is recommended by Ferrari for use in their cars globally. The oil is used for running Scuderia Ferrari Formula 1 car. Shell claims that the oil removes up to five times more dirt and sludge, protects up to three times better and reduces up to twice as much engine wear as a normal mineral oil.
PLANS FOR INDIA
The Hague-based company’s Indian subsidiary, Shell Lubricants India, targets to double its market share in the lubricants space in the next three years.
“We have a goal to double our market share in India in the next three years and consequently we are investing heavily in India. It is one of our top five focus markets,” said Prasad.
Shell is focussing to extend its tie-ups with vehicle manufacturers. Their service stations will sell Shell products and the company would offer engine-specific products.
Prasad said that Shell is developing unique oil that fits specifically to a particular brand of car. This would be beneficial to customers because it would improve maximums fuel efficiency and offer better protection to vehicles.
Shell Lubricants India already have tie ups with Tata Motors, Hyundai Motor India and Maruti Suzuki India Ltd. “We are expanding the list,” he reiterated.
Supply chain
Other than tie ups with manufacturers, the company is also expanding its supply chain. “In this, we have a global network of manufacturing points. We are investing in our local supply chain and branding,” Prasad said.
The over all lubricants market in India is about 2.5 billion litres. According to Shell, growth of lubricants market is proportional to GDP rate.
“The market is complicated. There are industrial, rubber and automotive oils. And in some parts we choose not do not compete. The parts where we compete, we believe we have around 10-15 per cent market share. This includes parts of automotive and industrial segments,” Prasad added.
Recently, Shell showcased India in its global campaign. Local images of trucks and the drivers have been included in the marketing exercise that is displayed globally.
Shell that claims to be the leading player in lubricants space globally has strong presence in the US, Europe and China. “We have our focus in BRIC countries,” Prasad said.
siddhartha.s@thehindu.co.in