May 17, 2016
Volume 7 Issue 3
Chinese Automaker Opens Blending Plant
Most lubricant companies produce lubes for automobiles, but one Chinese automaker is committed to making its own. In late April, Dongfeng (Shiyan) Motor Lubricating Oil (DMLO), a lube-producing arm of Dongfeng Motor Corp., opened a blending plant in Shiyan, Hubei province.
With capacity to produce 100,000 metric tons per year, the new facility will mainly supply automotive lubricants for Dongfeng Motor’s diesel-powered commercial vehicles. Dongfeng Motor is one of the largest Chinese automakers.
“Eighty percent of the lubes will be for the diesel engines, while the 20 percent will be for gasoline engines,” said an individual in DMLO’s supply department, who identified herself only by her surname, Wang. While Dongfeng vehicles will be the primary client, DMLO will also sell lubricants to other original equipment manufacturers, such as American engine maker Cummins, Wang said.
Dongfeng already operates lubricant plants in Beijing and Qingdao, both located in the northern part of the country. Hubei is in Central China, where Dongfeng Motor is headquartered.
Buying base oils mainly from ExxonMobil and additives from multinationals like Infineum, the company aims to supply products that fit into the upper tiers of China’s lubricant market, Wang added.
Dongfeng had used the Beijing and Qingdao plants to supply lubricants to its Central China auto factories, but the company wanted a closer lube supply.
“Logistically, it’s inconvenient and costly. That’s why Dongfeng built the Shiyan facility,” Wang said. She went on to say that there are some lube companies in Hubei province, “but they are small and usually not well equipped.”
Listed in Hong Kong and Shanghai, Dongfeng Motor in 2015 sold 2.9 million passenger cars and commercial vehicles, up 3.8 percent from 2014.
“Our sales are growing. With this new facility, we hope that we will be able to better support our dealers nationwide,” Wang said.