Newcomer makes big strides in local lubricant market

MANILA, Philippines - A relatively young company has made impressive gains and is now aiming for a place among the top five in the country’s lubricant market. Expansion plans include the establishment of a blending plant to cater to the Southeast Asian region.

Barely five years in operation, SK Philippines which is backed by the third largest chaebol (conglomerate) is South Korea, is making a big push in a market that is dominated by the so-called Big 3 — Petron, Shell and Caltex — and counts more than 30 players.

“With sales more than doubling each year, we are fast gaining momentum,” said SK Philippines chairman Timmy Tan, a scion of Taipan Lucio Tan. “This is because we offer a good product at a good price,” he added.

SK Philippines is into lubricants — automotive as well as for industrial and marine applications. The products are manufactured by the SK Group, the third largest conglomerate in South Korea, which is into energy, chemicals, telecommunications, trading and services. It was ranked 72nd in the 2009 Fortune Global 500.

The SK Group is the world’s biggest producer of group 3 baseoil. It has more than 90 subsidiaries. Founded in 1953 as Sunkyoung Textiles, the company group and became one the major chaebols in South Korea. It was renamed SK Group in 1997.

In the Philippines, SK supplies the lubricant requirements of almost half - 40 percent — the taxis in Metro Manila running on liquefied petroleum gas. In Davao, the two biggest taxi groups use SK lubricants, said Tan.

The group is also making good progress in the industrial and marine lubricant segments.

One advantage that the SK Group enjoys is that the number of Korean cars in the country is growing at an exponential rate. “But the real deal is that we have a very good product which we make available to our customers at a very good price,” said Tan.

As their market continues to grow, Tan said they are planning to put up a logistics center in Subic and in other ecozones to cater to the lubricant requirements of various locators.

Tan said they also plan to construct, in joint venture with SK Lubricants - Korea, a state-of-the-art toll belnding facility in the country to cater to the Southeast Asian region.