The Changing Face of Quick-Lube: Electric Vehicles and Motor Oil
“U.S.-based EV registrations doubled from 2017 to 2018 — with an estimated 1.1 million EVs expected to be sold nationwide by 2025” – April 2019 IHS Markit report
Still considered a niche vehicle in the eyes of the public, electric vehicles are slowing but surely gaining traction. Most market reports indicate that soon electric vehicles will be plentiful on our streets and roadside charging points a common sight. The big automakers already have a plan, fielding an increasing number of EV models catering to varying vehicle classes. Likewise, the aftermarket is busy planning and releasing products to accommodate EVs and their advanced battery systems. This begs the question; how will this affect general repair and quick-lube businesses?
McKinsey states that “by 2030, we expect that the number of light vehicles will have risen to about 1.6 billion (an increase of 500 million from 2015), with an estimated 18% of the fleet (290 million cars) electric.” While many electric vehicles share common styling with their traditional counterparts, EV powertrains are significantly more expensive. The various parts that make up these technologically advanced units will result in higher repair ticket prices should they require repair or replacement – a boon for repair centers who possess the knowledge and tools necessary. This is not to say that the traditional ICE vehicle is going anywhere anytime soon; EV and conventional automobiles will coexist for the next several decades as industry marques position themselves to accommodate and profit from both.
General repair businesses will adapt to the changing technology with new diagnostic systems and revised parts catalogs, but it’s quick-lube stores that will witness the most disruption. Today, most oil centric locations offer far more than simply oil changes, having expanded their range of services to include vehicle inspections, filter replacement, onsite car washes and more. In fact, many quick-lube stores and general maintenance chains evolved from offering mufflers or brakes just a few decades prior.
Tailoring services to cater to EVs will present a challenge to businesses whose physical locations are literally built for the sale, storage, and disposal of oil. However, hybrids, the most popular transitional vehicle, remain dependent on oil for their internal combustion engines, while EVs will still require fluids for their transmissions and other systems. “Compared to a regular internal combustion engine (ICE), the impact on oils and fluids for hybrid and electric vehicle operation is pretty significant,” stated Martin Birze, North America Passenger Vehicle Product Manager, Lubrizol. Fast-lube stores succeed by delivering high-ticket averages and superior customer service; whether these metrics are achieved by swapping oil or optimizing battery usage matters not.
Valvoline, one of the most recognized marques in the oil business and the second largest quick-lube chain in the United States, recently announced a new product line aimed squarely at the growing EV market. These new fluids were created specifically for battery temperature variations, EV powertrain performance, brake system corrosion, and more. Lubrizol notes that “hybrid and electric vehicles are harder on the transmission fluid than conventional automobiles. While automakers often sell some of these vehicles as being “maintenance-free,” some owners push their vehicle past the recommended service interval. We’ve also observed in these cases, that transmission fluid electrical conductivity increases with aging. And we are seeing that with more copper present in these e-motor transmissions to give higher speed and generate more heat, fluids must increasingly be capable of providing performance requirements — such as better heat transfer capability, optimized electrical conductivity, extreme pressure protection and compatibility with the increasing use of diverse plastic materials in these vehicles.” Quick-lube businesses, with their negligible property footprint and small capital investment, are then well positioned to cater to the needs of electric vehicles; all that’s required is technological know-how paired with the right solution.