Product Consolidation: Opportunities and Risks

by on November 14, 2017 0 Comments

Oil BarrelsFormattedThere’s little question that heavy equipment maintenance managers would prefer to minimize the different types of lubricants they have to keep in inventory to meet their many applications. A significant percentage of a product’s total cost is tied up in storage – 25 percent by some estimates. So, there is a strong economic incentive to purchase oils that can be used for more than one application.

Manufacturers of mobile equipment and lubricant producers like Chevron have recognized this need. The OEMs have done a fairly good job of minimizing the number of products going into equipment and the risk of cross-contamination. Many John Deere tractors, for instance, use the same fluid for transmissions, wet clutches, brakes and hydraulic systems. Also, Caterpillar allows the use of SAE 15W-40 and 10W-30 engine oils with greater than 900 ppm zinc in many hydraulic and hydrostatic transmission systems.

At Chevron, we have a number of products that can be used in multiple applications. We are exploring higher viscosity index oils and synthetics that can be used to cover a wide range of viscosity requirements among different applications. We also produce engine oils, such as the Delo® 400 XLE 15-40 and 10W-30, that can be used in both diesel and gasoline engines. We are working to help our customers take advantage of opportunities to consolidate while avoiding the risks of cross-contamination that can impair performance or lead to equipment failure.

It stands to reason that if you can consolidate from, say, 15 different oils down to five, you can reduce your overall inventory and storage costs and improve efficiency in your maintenance, repair and operations (MRO). It’s important, however, to consult with your lubricant supplier to be clear on compatibility across applications and ensure you are not putting your equipment at risk.

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About the Author ()

With over 35 years in the oil and gas industry, Dan Holdmeyer has worked for Chevron the past 14 years, serving in a variety of capacities with the company in addition to his current post as Industrial and Coolants Brand Manager where he works as a lubrication engineer that supports Chevron Delo and other related lubricants brands. He plays an integral role in supporting and managing a variety of programs related to off-highway and on-highway lubrication needs. Dan also works as Chevron’s Training Specialist for their Global Lubricants division since joining the company. Prior to joining Chevron, Dan worked as a Field Engineer at Mobil Oil Corporation for 20 years (1979-99) after graduating from the University of Missouri-Columbia with a Bachelor of Science in Chemical Engineering.

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