From the President’s Desk September 2011

Amsoil Executive Staff

The lubricant market has seen considerable pricing volatility in the past several months, and like all other manufacturers, AMSOIL has been affected. Rising costs on base oils and additives have forced all companies to raise prices on finished lubricants. And while I had not intended on spending a lot of time discussing this, we have heard some mild grumbling from the field recently and I want to address the issue directly.

The very last thing AMSOIL INC. wants to do is raise prices. We consistently hold off doing so for as long as we possibly can. Those who follow the market closely can tell you that virtually all other lubricant manufacturers have raised their prices three to four times since early February and are now set to do it again. Valvoline, for example, has announced a six percent increase to its distributors, effective September 19. Shell will boost its prices another five percent, also effective September 19. Chevron, ExxonMobil, ConocoPhillips, Citgo and BP Castrol will impose similar increases in September.

Meanwhile, AMSOIL is doing its best to hold the line. We have limited our increases to just three times during this period and each percentage increase has been held to approximately one-half of what consumers are seeing from the others. And while I cannot predict the future, I can tell you emphatically that we have no plans for additional increases now.

That’s not to say it wouldn’t be justified. We are seeing the same cost increases in raw materials that other companies are seeing. But we approach things differently. Rather than bumping up our prices we are working diligently to offset our increasing costs by finding ways to control our administrative and operational costs. We are looking at all areas of the company and taking every measure we possibly can to limit our expenditures and improve our efficiencies at all levels. Keep in mind also that the base oils and additives we use to build our products are top of the line. It costs us more to formulate our lubricants than other companies are willing to spend. Yet, while others may find ways to cut costs through formulation downgrades, we do not. It is just the opposite. We continue researching new technologies to make our products even better.

It is important for our Dealers and Preferred Customers to understand that while all companies must make a profit, AMSOIL has never, and will never, let profit become our main driver. My philosophy has always been, a half a loaf of bread is better than none. We manage this company properly and do not overprice our products.

In fact, an AMSOIL Dealer makes more money on the sale of a quart of motor oil than the company makes. And that’s the way I want it. Our goal has always been to help our Dealers become as competitive in the marketplace as they can possibly be. By holding our costs down now while others are raising theirs, we will find ourselves in an even better competitive position. Once the price increases imposed by other companies work their way down through their distributors and out to their customers, our pricing will be more competitive than ever.

And beyond price, of course, is value. Our extended drain lubricants, particularly our Signature Series line, provide value that other lubricants simply cannot match. You can assure your customers that the company you represent is taking every possible measure, in the face of rising costs, to do what is right for them.

A.J. “Al” Amatuzio
President and CEO, AMSOIL INC.

Author: johnzena

Amsoil dealer in Las Vegas NV. Plus I work as a dice dealer at the Bellagio.

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