Brazil's car fleet has doubled since 2000, according to a new report.
One for the lucky few in São Paulo Image: Rolls Royce |
About 30 million passenger cars are on the road in Brazil, according to a report by consultants IHS, and that also means good news for the lubes industry.
An accelerating economy has led to a doubling of the passenger car parc since the start of the Century which, in turn, has led to a 33% increase in lubes consumption over an eight year period from 2004-12, equating to some 1.2m metric tons of finished product and making it the sixth largest lubes market in the world.
With the disposable income of Brazil's population growing rapidly, after GDP tripled over the eight years, many families have now been able to buy their first car in a country that still has a relatively low car access rate (motorization) according to IHS. Currently motorization stands at around five people per car, with IHS predicting that figure to drop to as little as 3.3 within the next 10 years.
According to the report, there are some 4,000 lubes products offered by more than 300 domestic and global producers and distributors. However, IHS's Stefan Mueller commented that the market had to undergo development: "From a quality perspective, the lubricants market will change greatly before 2020. New regulations are coming that demand less air pollution as well a decrease in fuel consumption for motor vehicles. These goals can be achieved only by introducing products based on higher-quality base oils, and new additive chemistry that has already been developed in North America and Europe."
Nearly 70% of all lubricants used in Brazil are for automotive applications.