A Tale of Two Automakers,
Continued

“There are two types of engine oil specifications: OEM and industry specifications like ILSAC and API. OEM specs let the auto company tailor the product to meet their specific needs, while industry specs set a minimum level of performance,” he said. “OEMs have to address their customers’ needs and governmental regulations. Customers are focused on satisfaction, fuel economy, the environment and economics, while governmental regulations are forcing rapid changes in CO2 limits, fuel economy improvements and emissions reductions.”

The ongoing goals for dexos, according to Johnson, are to lengthen catalyst life and reduce dependence on crude oil through increased fuel efficiency and reduced number of oil changes.

Left unsaid is that dexos will almost certainly be a moneymaker for GM, as the company plans to charge manufacturers a $1,000 per year license fee, with an additional 36 cents per gallon “underhood” royalty fee that will no doubt be added to the cost of what already promises to be an expensive product. Johnson insisted that the royalty fees are needed to make dexos “self sufficient,” and he added that dexos will meet its customers needs by offering better fuel economy throughout the life of the oil.

“It’s all about the customer,” Johnson said. “Once they understand the benefits, they will appreciate the specification.”

In that vein, GM has established a program administrator for dexos to ensure the product’s availability after its launch later this fall and to ensure that both dealerships and end users are educated about the new motor oil.

One end-user benefit Johnson repeatedly touted is extended oil change intervals. Already, GM notes that if all GM vehicle owners followed the GM Oil Life System (OLS) in their vehicles as intended, more than 100 million gallons of motor oil could be saved annually. With dexos on the horizon, Johnson said GM is actively developing the second generation OLS, a system that will rely on significantly more engine operating information than the current system, which calculates “remaining oil life” based on factors like the number of combustion events, engine operating temperature, oil temperature and ambient air temperature. A second-gen OLS, coupled with a full-synthetic dexos product, could allow GM to significantly extend the maximum oil change intervals the OLS recommends.

“Changing oil significantly more frequently than required is not environmentally responsible,” Johnson said. “The 3,000-mile oil change recommendation is not sustainable long term. It’s not ‘cheap insurance.’ It’s just a waste of resources.”

GM plans to phase out any mention of ILSAC or API specifications in its owners manuals, in order to promote the new dexos specification. A mockup of an owners manual Johnson showed includes the warning: “Failure to use the recommended oil can result in engine damage not covered by the vehicle warranty.”

Impact on the Lube Industry

The initiatives being undertaken by both automakers will have a lasting impact on the fast lube industry. Ford’s reliance on smaller, harder-working turbocharged engines will put even more pressure on motor oil, possibly limiting the ability of even the next-generation GF-5 motor oil to offer oil change intervals that are much extended beyond today’s standards.

GM, meanwhile, will shortly introduce a proprietary (probably synthetic) motor oil that will allow its engines to maximize technologies like displacement on demand and variable valve technology. The good news for lube operators is that dexos will take a while to achieve a large market penetration. Estimates are that a little more than 10 million 2011-model vehicles will be sold, with approximately 16 percent (or 1.6 million) of those being GM vehicles. That will amount to less than 1 percent of all the vehicles on the road, and unless GM’s market share rebounds significantly in coming years, it will take most of the coming decade before dexos becomes a significant mover in the motor oil market, as it’s doubtful that drivers of existing GM products will adopt dexos en masse in favor of cheaper traditional alternatives.

Regardless of the changes made and technologies adopted by these and other automakers, the facts are clear that automobiles will continue to use internal combustion engines — in some capacity or another — for decades to come, and that those engines, as well as other automotive systems, will need routine preventive maintenance, a service the fast lube industry is more than adept at providing.

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