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Are Synthetics Really Too Expensive?
Examining the Value Equation
by Ed Newman
AMSOIL Director of Advertising
This article appeared in National Oil &
Lube News, September 2006
When I first began writing for AMSOIL 20
years ago one of the biggest “complaints” I heard from new Dealers was
that at five dollars a quart synthetic motor oil was “too expensive.”
What I find interesting is that while the price of conventional
petroleum oils have risen dramatically over the years, synthetic oil
price increases have been modest at best. Synthetic oils were once 10
times the price of regular oils.
Yet there were other issues, too. People
did not have the confidence in synthetics then that they do today. Back
then you heard people say that it caused seal swell or was so slippery
it would leak right out of the car. Today, however, when all is said and
done, nearly everyone agrees synthetic oils are better, but still some
feel that they cost too much for what you get. Are synthetic oils
expensive? Let’s take few moments here to compare the cost of synthetic
oil to the cost of bottled water.
A Google search led me to a Jeff Matthews
column where he does a breakdown on the cost of “Ethos” bottled water
that is sold at Starbucks. According to Matthews the bottle contains 1.5
pints of water from the Tomhicken Mountain Springs near Pottsville,
Pennsylvania. Cost: $1.23 a pint or near two dollars a quart and over
nine dollars a gallon. This is water from a spring and, yes, it is good,
but what is involved in making it?
Well, there are more expensive waters
than this. SuperNariva is magnetically energized water from a spring in
Japan’s Magnetic Mountain, purportedly providing a number of spectacular
properties including resistance to disease and longer life. At $99.95
per milliliter, or $10,000 a liter, you won’t want to spill a drop.
Other waters claim exotic origins, though
many bottled waters are simply taken from municipal water supplies,
treated and bottled. At one to three dollars a quart, bottled water
companies are experiencing a good brisk business. In fact, according to
the Beverage Marketing Corporation, Americans spent more than nine
billion dollars on bottled water, an industry growing nearly 10 percent
per year for 10 years straight.
Whatever the price, the process of making bottled water is probably
pretty straightforward. Take some water, put it in a bottle, label it
and ship it. By way of contrast, let’s review a few of the steps
involved in making premium synthetic motor oil and the associated costs.
First, the raw materials must be
assembled. But before the raw synthetic base stock is unloaded from the
tank truck or rail car, quality control test sequences are commenced.
Incoming bulk materials cannot be placed into storage tanks containing
pure supplies until they have been tested and approved. At AMSOIL we tie
a red ribbon on every outlet valve at the time of sampling and quality
control testing procedures are carried out for every single ingredient
that will become part of the finished product.
Once the certificate of analysis is
written up, the incoming material is moved from dock to stock status.
This procedure is carried out for every additive, which varies with each
lubricant from 5 to 12 ingredients.
From here we go to blending, a process
far more complicated than the simple assembling of ingredients as in
making chocolate chip cookies. Assuming a commitment to high standards,
there are quality control procedures for cleaning the hoses, tanks,
pipes and valves as well as the containers for sampling. Records are
kept for each step.
After the lubricant is blended, another
round of quality control testing is undertaken. Each lube has its own
sequence of tests to pass. Not all are time consuming. One test for the
gear oils, for example, takes half an hour. Motor oils have the Noack
test for volatility which takes 1.5 hours, but another standard test
takes 13 days. IR scans on all samples are run on a $250,000 piece of
equipment. Field trials when developing new formulations can take years.
How do you even measure these kinds of costs? Researchers are
continually looking into the unknown and reacting to results. Amount of
time spent and the testing varies with each product.
Summing Up
The easiest way to describe QC for our company is that all products are
tested three times before they reach the customers’ hands. Once as a raw
material, once as a finished product, and once before packaging. Add to
this the cost of raw materials themselves, plus labor and equipment
costs for blending and manufacturing. Space does not permit me to
outline the multi-page documents outlining the operation of our bottling
line.
Ultimately, the consumer does not care
much about all these details. You can help reassure them that oil
companies are holding the line on costs as best they can, that there is
more involved than meets the eye. Motorists want to protect their
investment, whether car or light truck, so they can spend time thinking
about other things.
Are synthetic oils a good value? Everyone
knows they are indeed superior to conventional petroleum in protection,
performance, power, engine cleanliness, and better mileage. The price of
synthetics may be higher than most bottled water by a smidge, but the
benefits to a vehicle are immeasurable.
Ed Newman is the Director of Advertising for
AMSOIL INC., the leader in synthetic lubrication since 1972.
T's Advanced Synthetics
Greg and Marcy Thurman
Your Nationwide
AMSOIL
Authorized Independent
Dealer
Nationwide US Warehouses,
Canada and Palm Harbor, FL
727-798-8552
E-Mail:
greg@tsadvancedsynthetics.com
If you
experience problems or have questions or comments about
our website please email us at
greg@tsadvancedsynthetics.com
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