Foreign brands take up 78 percent of car lube market in China
( 2003-10-20 21:36) (Xinhua)
Foreign brands have taken up 78 percent of the sedan lubricant market in China, and most of some 4, 000 domestic lube brands gathered in the low-end market and only accounted for 22 percent of the high-end market, said China Petroleum & Chemical Corporation (SinoPec).
According to China's leading petroleum producer, the country uses nearly 4 million tons of lubricant annually, ranking third in the world. With the increasing number of private cars, it added that the volume is likely to rise by over five percent annually in next three to five years.
The high-end products, like sedan-used lubricants, make up 30 percent of the total volume but approximately 80 percent of the profit in this market goes to them, market insiders noted.
Almost all world leading lube brands have entered the Chinese market, including Esso, Shell, BP and Caltex.
China's tariffs on lubricants have reduced from nine percent to six percent since it entered the World Trade Organization (WTO) in late 2001.
SinoPec said that domestic lubricants are competitive in quality with foreign products but their marketing is weak.
The company has finished building five major sales networks in Beijing, Shanghai, Wuhan in central China, Chongqing in southwestern China and Maoming city in south China, as a significant move to fight for more shares in high-end market, it said.
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