What do Daimler, Rio Tinto and Nokia have in common? They have seen extraordinary destruction in shareholder value due to acquisitions (Chrysler and Alcan respectively) or, in Nokia’s case, a change in technology then acquistion, as Apple ate its breakfast with its smartphones and tablets, leaving the Scandinavian handset leaders to struggle for market share before finally being bought by Microsoft.
In the lubricants and oil business, we are seeing more re-alignment of assets as Total buys the Shell and Chevron assets in Egypt. The French oil major is continuing to build African assets as that continent now appears to be industry's the new growth area. At the same time, Shell is divesting its European base oil facilities to Nynas, just as Russia's Lukoil steps further into Europe with its acquisition of OMV's lubricants business. These all seem sensible adjustments to portfolios rather than betting the whole business. But, as the period of super-cheap money draws towards a close and funding costs rise, might we see be about to witness another major re-alignment of 'big oil'?
The collapse of the Rupee in India highlights the challenges of the emerging BRICS as the impetus for global growth. The 22% depreciation, combined with a 15% rise in spot crude prices, is the sort of squeeze that makes the austerity measures imposed across most European countries look insignificant. As the world’s second most populous country, the news from India is a serious problem for global growth and any confidence in a BRICS-led recovery. It is clear that re-balancing takes time wherever you are.
Remarkably, the UK has emerged as one of the faster growing developed nation economies. However, we should not lose sight of the sustained, albeit lower GDP growth in the US of 1.6% annual, whereas the ECB now only expects the Eurozone to contract by less than before at -0.4% in 2013.
So, Shell (amongst others) is focusing on its core business of sticking close to OEMS and committing to develop LNG infrastructure. The eventual emergence of electric vehicles and the possibility of no-cog gearing technology may transform the lubricants business. Compared with the internet these changes will be steady and progressive.
As far as internet marketing for technology is concerned, the further acceleration of complex and intricate solutions as opposed to simple recommendation look-up sites is continuing. As you would expect from the global industry leader, OATS is at the forefront of these changes.
New OATS database structures and implementations will permit greater flexibility in the display of information, user journey and language support. OATS new Lubecode Logic will make the product-matching process easier. So, for those lubes marketers considering upgrading their websites, now would be the ideal time to talk to the OATS team.
It is also clear that the new-look OATS Bulletin has been well-received, particularly with its focus on the Lubricants marketing challenge. We will also continue to use social media via Twitter @Oats_Ltd, Facebook and LinkedIn of any new articles that appear in the Lubes Resource Centre.
Sebastian Crawshaw
Chairman, OATS