November 20, 2019
Volume 3 Issue 4
Expanding to Grow in Evolving Grease Market
Aerospace Lubricants is nearing completion on an expansion to add 10 million pounds of grease production capacity at its plant in Columbus, Ohio, to help increase its product offerings and to open up sales into the industrial, automotive and private label grease market segments.
The expansion includes 10 stainless steel grease kettles that are at the center of a plant design focused on improved product quality by allowing dedicated production lines by thickener type to prevent cross-contamination, the company said in a news release. One of the kettles will be devoted to a line of food-grade greases meeting the NSF H-1 standard, a new group of products for Aerospace.
The plant expansion – on track for completion by the end of this month – is part of a growth strategy, John Lorimor, technical director for Aerospace Lubricants, said. Founded in 1973, the company’s customer base has primarily been comprised of aviation original equipment manufacturers and military hardware contractors. “We were struggling to grow the business with such a narrow focus,” Lorimor told Lube Report in an email interview. “Automotive products for interior vehicle applications is a more recent product range and has experienced strong growth. We expect to do even more business with Tier 1 component manufacturers by being able to offer an expanded range of grease thickener types to better offset competitor product lines.” Tier 1 suppliers are companies that supply parts or systems directly to OEMs.
Synthetic lubricants have been at the heart of the company’s product range, he noted, and industrial is a market segment where the grease maker knows the use of synthetics has been growing. “For example, our product range for robotic gear sets continues to experience a very high growth rate,” Lorimor said.
The company ships products globally. “For automotive products, the key areas of export are to Mexico and China,” he added. The expanded capacity also enables the company to offer private label manufacturing. “Since the expansion provides capacity far beyond our current internal needs, we have chosen to offer it up to those seeking private label greases or toll manufacturing,” he said.
The company stated that with special emphasis on grease cleanliness, it has employed high levels of product filtration and can process products down to 35-micron filtration prior to packaging. Batch sizes will range from 1,000 to 10,000 pounds to better align with market needs for small-volume, customized products, the company said.
The North American market is trending toward that type of business, according to Lorimor. “With the active consolidation of grease producers in North America into fewer but larger players, there is a strategic move to being better able to service large-volume grease business,” he said, noting that investment at larger grease producers is primarily designed to make larger volumes in less time. “At the same time, these larger businesses are also shedding complexity through product line simplification and customer rationalization.” He said this results in reducing the number of products produced and number of customers served, basically keeping the large business and cutting off small-volume business.
“In this scenario, small customers are feeling the pinch of not being able to get their products produced,” Lorimor said. “There is also limited differentiation possible, with everyone receiving the same core formulas. If the customer is lucky enough to actually get grease produced, it is from a limited selection of primary products that the manufacturers produce in large volume.” He explained that custom formulations typically require the customer to take a full batch. “In some cases, the batch size requirements mean a small-volume customer is potentially sitting on a year or more of inventory. For a new product being launched with unknown sales, this is not typically an acceptable proposition,” he added.
The company makes greases that contain lithium, lithium complex, anhydrous calcium, calcium complex, calcium sulfonate, aluminum complex, polyurea, bentonite clay, polytetrafluoroethylene, polyurea and fumed silica thickeners. For base oils it uses polyalphaolefin, polyalkylene glycol and oil soluble polyalkylene glycols, esters, perfluoropolyether, silicone and various mineral oils.