FROM INFINEUM INTERNATIONAL LIMITED

LUBRICANT TRENDS,
PASSENGER CARS,
COMMERCIAL VEHICLES

23 JUNE 2020

Moving to even lower

viscosities
The latest on North American engine oil viscosity grade
trends

Engine oil viscosity grade trends, which are crucial for accurate supply and
demand forecasting, are surprisingly difficult to call. Jeff Thompson, North
American Crankcase Market Manager, explores the factors influencing them
and reveals some of the latest thinking from Infineum on the future for both
passenger car and heavy-duty engine oils in North America.
Of all the lubricant-related questions Infineum receives, those concerning future SAE
viscosity grade trends are some of the most common. Not surprising, since they are
critical factors when supply planning for base stocks and viscosity modifiers, which means
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 it is really important to get them right. On the surface this might seem straightforward but,
since there are a wide range of factors that can influence them, these predictions are in
reality very complex.

Focus on passenger cars

In North America in 2019, while new light-duty vehicle sales were down slightly at just over
17 million, sales of used cars hit a new record of 40.4 million. New cars generally use
lower viscosities and therefore vehicle population age is one factor that impacts viscosity
grade trends. With a car population estimated at some 270 million vehicles, this trend for
increased used car sales will drive up the average car age as new sales try to push lower
viscosities forward. This means the latest new gasoline engine oil recommendations for
the lowest viscosities, makes up a smaller part of the total car parc.

Clearly the impact of the coronavirus disease (COVID-19),

will exacerbate this situation and US light-duty sales in
May 2020 were down more than 30% year on year.
Estimates will vary, but annual retirement of around 4% of the 270 million vehicles is
reasonable and as the vehicle parc churns so do the viscosity grade recommendations. In
most cases an SAE XW-20 recommendation is replacing SAE 5W-30 and thicker oil
requirements.
New specifications are another influencing factor and always a major topic of discussion in
industry. From January 1 2020, pre-registrations opened for the new, long awaited, API
gasoline engine oil standard ILSAC GF-6. And, from May 1 2020, oil marketers could
claim ILSAC GF-6A/API SP or GF-6B/API Resource Conserving (RC) and display the
appropriate API certification mark. ILSAC GF-6B enables new fuel economy viscosity
grades below SAE 0W-20 to be introduced with its own certification mark.

Although the North American market is likely to transition

quite quickly to the new ILSAC GF-6 standard, in the main,
only a small segment of new vehicles will use the lowest
viscosity grade, SAE 0W-16.
This has a knock on effect in that, even if we look out ten years, volumes of fuel economy
grades such as SAE 0W-16 could remain relatively small. This could change if OEMs build
more engines that are designed for SAE 0W-16 and allow this grade in more of today’s
engines, however this so far seems unlikely. We are seeing some movement by OEMs,
such as Toyota, to suggest SAE 0W-16 in more vehicles during this model year but it lags
behind the recommendations being made for lower viscosity in Japan. Car maintenance is
also an important factor to consider. With a growing number of OEMs pushing customer
subscriptions, we may see more dealer-based car servicing. This means that vehicles that
could use SAE 0W-16 are more likely to be service filled with that grade during a dealer
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 based service.
For maintenance outside of dealer control, consumers could use 3rd party service
providers or carry out oil changes themselves. And, in these cases, despite the fact that
good quality oil protects the engine there may be a tendency to select more conventional
or higher viscosity oils rather than SAE 0W-XX and premium performance products if they
are given the option and allowed.

Passenger car viscosity trends

Currently, in the North American passenger car motor oil (PCMO) market, SAE 5W-30 is
the most common viscosity grade. Although it was first introduced as a more standard
recommendation in the late 1980’s today it represents some 40% of oil sold, despite the
fact that SAE 5W-20 and 0W-20 are the most widely recommended grades for the
newest cars. Compared to the HDD market where users are very wary about using lower
viscosities, even if they are recommended, PCMO moves more quickly. Looking out ten
years, there is likely to be a fast decline for SAE 5W-30 and significant growth for SAE
0W-20. SAE 5W-20 sees some decline but it could be viewed as a transitionary grade to
the eventual use of more SAE 0W-20.

SAE 0W-20 is expected to rise from some 20% today,

becoming the most popular grade by 2025 and reaching
close to 50% of oil sold in ten years.
Over the forecast period, SAE 0W-16 continues to be a niche grade, with no clear path
yet for increased OEM use in North America until a majority of vehicles sold call for that
viscosity grade.

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 Heavy-duty diesel market
In 2019, North American heavy-duty diesel (HDD) vehicle sales saw strong growth,
reaching some 276,000. The vehicle parc is split some 60% being on-highway and 40%
off highway, with each application having its own lubrication requirements. COVID-19 is
impacting Class 8 sales, with orders in North America in May down 38% on the previous
year. This, combined with a rush to cancel previous bookings, puts fewer of the latest
technology trucks on the roads.
On the specification front, to support fuel economy drivers and the introduction of new
emissions reduction hardware, API introduced CK-4 and FA-4 on December 1 2016. The
new standards delivered improved aeration performance, wear and deposit protection,
oxidation control and shear stability over API CJ-4. In addition, API FA-4 introduced fuel
economy SAE XW-30 grades with high temperature high shear (HTHS) viscosity range of
2.9cP–3.2cP for on-highway applications. To date there have been 1,385 API CK-4
registrations, while API FA-4 registrations seem to have flattened out at 105.

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 Heavy-duty diesel viscosity trends
In this market, SAE 15W-40 had been the workhorse viscosity grade for many years, but
it has peaked and is forecast to decline to near 30% by 2029. And, although OEMs have
been using SAE 10W-30 since API CJ-4 was introduced in 2006, it has until now had only
a small market position. Looking ahead, since the fuel saving benefits of lower viscosity
lubricants are considerable and OEM specifications are being introduced to support their
use, the growth of lower viscosity grades should be significant. A rapid shift towards SAE
10W-30 is expected – especially in the on-highway sector. By 2029, SAE 10W-30 may
account for ~40% of the market and high value SAE 5W-XX, although not reaching
mainline volumes, could make ~10%. The growth of even lower SAE XW-20 volumes
however looks likely to be a slow process that depends on further innovations by HDD
OEMs.

HDD fleet owners and operators are becoming

increasingly comfortable with API CK-4 SAE 10W-30 fluids
but they are still hesitant to use lower viscosity API FA-4 if
not explicitly supported across the entire fleet.
Even then, durability is crucial. The use of API FA-4 SAE 10W-30 will continue to be slow
until entire fleets turn over such that OEMs specifically endorse API FA-4 fluids in those
engines and auxiliary power units also support API FA-4 (or electrify!).
Volvo is set to introduce its VDS-5 specification in the near future that will be an 'FA-4
type' SAE 5W-30. This could drive some of the increase in the synthetic SAE 5W markets
as well as provide some growth for API FA-4 fluid sales as customers become more
comfortable with the viscosity grade. Since API FA-4 viscosities are a bit of a niche today,
could oil marketers start to prefer selling a SAE 5W-30 API FA-4 instead of a SAE 10W-
30 API FA-4 if they are going to sell an API FA-4 product at all? This will be an interesting
area to watch as it unfolds.

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 Impact on additives
In both PCMO and HDD applications it is essential that, in the quest for fuel economy, the
introduction of lower viscosity grades does not compromise engine durability or emissions
system compatibility. Additives are designed to ensure lubricants can function at much
lower viscosities and retain their protective properties over ever extending drain intervals.
New lubricants not only provide enhanced fuel economy via their viscometric and frictional
properties but also enable the introduction of new engine technologies that provide
significant increases in both fuel economy and engine performance under more extreme
operating temperatures.

The trend to lighter viscosity grades impacts the scale and

the shape of demand for viscosity modifiers.
Lighter grades generally require lower treat rates of viscosity modifier polymers, but the
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 characteristics of these polymers will be critical to maximise fuel economy and both low
and high temperature protection. Any drop in demand in developed markets that comes
as a result of more narrow cross grading may be offset by overall growth in emerging
markets. In addition, there is a trend for these markets to move away from monogrades
(and heavier multigrades) to lighter multigrades that are common today in developed
countries.

Summary
Predicting future viscosity trends requires a large amount of data, detailed market
research and a high degree of insight. As pressures to curb CO2 emissions drive the
automotive industry to further improve fuel economy we can expect the trend to lower
viscosity engine oils to continue. In Japan, for example, the new ultra-low-viscosity
gasoline passenger car engine oil specification JASO GLV-1 has been claimable since
October 2019, which paves the way for the introduction of SAE 0W-8 oils. HDD OEMs
see real fuel economy savings at potentially targeting SAE XW-20 and lower oils in future
designs.

The question that remains is: just how fast and how far will
this trend to low viscosity go?
While we can say with some certainty that no prediction on this topic is perfect, Infineum
will continue to monitor the market to understand how quickly we shift but it is also
investing to always be ready with the technology needed to support even the most
extreme low viscosity needs.

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