GAZPROMNEFT-LUBRICANTS: TEN YEARS OF SUCCESS

27 DECEMBER 2017
Alexander Trukhan, General Director of Gazpromneft-Lubricants, talks about the early days of the company, explains the opportunities that open up for business development during crises, and what advantages testing products in off-road races provides.

Q: This year Gazpromneft-Lubricants, your Company, is celebrating its decennial. Please tell us about the early days of the company.

Alexander Trukhan: The Company was founded in November 2007. Everyone on the team was new, but we selected qualified professionals with work experience and expertise in our industry. We wanted the team to work on very concrete objectives that constituted the strategic goal of attaining technological leadership in the industry.
v Ten years ago, the market of lubricants in Russia showed some very remarkable trends. The industry produced 2.5 million tons of low-price lubricants, of which around 1 million tons was left unsold, while some 500,000 tons of premium products at average and high prices were imported every year. Which means that Russia depended on importing more than 30% of all lubricants the country needed. We knew that there was a niche available for us in the high-tech segment of the market. Some very decisive action was necessary if we wanted to take that niche: our competitors on the market were among the top 10 international producers of lubricants. To this end, we started investing money in cutting-edge future-oriented projects and created our own formulas for lubricants.

Q: When did you realize that you had chosen the right strategy for the company’s development?

Alexander Trukhan: When we obtained our first results. It was then that we knew our strategy was well chosen. It was especially obvious during the crisis of 2014. This was the time when Russian and international companies cut back their programs, freeing up large niches on the market, including high-tech product niches where the competition had previously been quite severe. It was these challenging niches on the market that we aimed for during the crisis years. We did so consciously because we knew we had something to offer in return. The period of crisis was when we started working actively on international projects and began implementing the import substitution program inside Russia.

Here’s yet another example: In 2008-2009, when production volumes fell almost in every sector, we invested in development of our own production capacities. In my opinion, crisis is just the right time to examine various features of the market and assess the new opportunities.

Q: Your Company’s lubricants are sold not only in Russia, but abroad as well. How did you manage to capture the market previously occupied by Western manufacturers?

Alexander Trukhan: This is a question we hear quite often: Why do you insist on selling your products in Europe despite all the competition? Yes, the competition is quite strong, but there are always some segments on the market that offer opportunities. Our extensive product range allows us to create a flexible competition policy across different markets, creating an additional effect for our business.

We study every region of our presence very carefully, paying attention to the smallest detail. We analyze the machinery fleet, climate conditions, production facilities, and logistical capabilities. So our success is based on this comprehensive time-tested approach, and this allows us to increase supplies to Europe year after year. Next year, we will continue expanding our presence on the European market; we have a range of programs that we will introduce and develop not only in EU member states, but also across the globe. I think that today we have everything we need to continue with full-scale expansion of our products: high-tech production facilities, powerful brands and a broad cutting-edge product range for many different types of equipment.

Q: Recently you launched G-Energy Academy, a new specialized education center for staff of partner distributorship companies. What was the rationale behind this?

Alexander Trukhan: We focus on high-tech products, and working with this category of products requires experience and advanced professional expertise. Therefore, our goal as manufacturers is to build a cutting-edge system for delivery of products to consumers, with minimal expenses in the shortest time possible. Our partners – product distributorships – play a very special role in this process. We develop and introduce training programs for our partners, not only in-service training for managers, but also special skills training programs for engineers who must know all the ins and outs when it comes to using our products. They must be able to select just the right lubricants for any kind of equipment, including the most sophisticated machinery.

Today, the staff of three hundred distributorships in 72 countries constitute our cohesive team. Our cohesiveness is what allows us to work as effectively and efficiently as we can, supplying high-quality products to various consumers: drivers, ship owners, agricultural businesses, quarry equipment operators, drillers and many others. Such a systemic approach is very important for us because today we produce over 500 varieties of oils, lubricants and technical liquids. Special knowledge is required to be able to find your way in this multitude of products.

After we received our ISO/TC 16949 certification, we started working actively with car manufacturers trying to organize shipments of our products to car assembly lines. These deliveries required shipping products every day or every other day, so our distributorships needed to have not only highly qualified engineers, but sizeable logistical capacities as well.

Our products are being manufactured at six plants in Russia, Italy, and Serbia. They reach our consumers via logistics companies or our partners. The intensity of this work defines our requirements for our distributorships: their logistics capabilities, a professional team, understanding of the regional market, development orientation and competence-building strategies in place.

Q: Your Company has been providing support to racing teams for several years already, including MAZ-SPORTauto and G-Energy Team racing cars that compete in such prestigious events as Dakar and Africa Eco Race. What does this give your business?

Alexander Trukhan: One of the best tests for lubricants is the test during off-road competitions. We have tested our G-Energy lubricants at various races for four years in a row already, and the successful results of our racecar drivers confirm steadfastly the high quality of our products. Every product first appears in the lab, then is tested on special stands that imitate the operation under real-life conditions. These are all admissible loads, but you always want to know what will happen if you push it to the limit; this is only possible under real-life conditions. Such as, for instance, the Dakar Rally that takes many days.

We developed the G-Energy Racing oil product range several years ago. Our company was the trailblazer in the area of sport racing oils, and we tested our products under real-life conditions of off-road competitions. Today, our company is the only one in Russia to produce racing oils with polyalphaolefins and saturated esters Group 5 base oils (according to API classification, – Ed.). Last year, we launched production of own Group 5 oils; that is, we produce raw materials for our race oils ourselves. Let me note here that far from every manufacturer of such specialized oils produces their own components. For us, the high-tech base that we have is a considerable achievement in the sphere of technology.

Our engineers take their mobile labs to the race route and cover the entire length of the route with the drivers. They take samples and analyze them in real time. This year, we have another racing marathon ahead of us. This time, the Company’s engineers will bring, in addition to the customary infrared spectrometer, a novel device, i.e., X-ray spectrometer, which determines the concentration of metals in lubricants. Such equipment allows conducting comprehensive studies under field conditions, results of which in turn enable vehicle maintenance adjustments by the technical specialists. After we come back home, all the knowledge we get during the race is used to develop new, more perfect lubricants for cutting-edge equipment of the future.

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