China is the world's fastest-growing lubricant market, with demand expected to increase 3.5 percent annually through 2013. Asiannewsphoto

Fei Manqing realized early that a partnership with a leading global brand can be a shortcut for Chinese small business owners. Fei also entered a market that is attracting many leading multinational companies - China's booming automotive aftermarket sector.

Fei signed a contract with ExxonMobil Corp, the world's largest publicly traded oil and gas company, in 2004 to become a member of the ExxonMobil Esso Oil Change Center and then joined its Mobil 1 Car Care network in 2006.

She received hundreds of thousands of yuan to redecorate her stores, as well as management and training support from ExxonMobil.

"Now we have unbelievable monthly revenues of more than 500,000 yuan, four times the figure in 2004 before we joined hands with ExxonMobil," said Fei, general manager of Shanghai Chejie Automobile Technical Service Co, which has 60 auto service stores in Shanghai.

Like ExxonMobil, rival Shell Oil Co also is expanding its aftermarket presence in China.

"Although the 3S (sales, service and spare parts) and 4S (sales, service, spare parts and survey) stores are still the major distribution network for Shell lubricants, we see a bright future in China's emerging auto fast-service industry," said Shen Jian, general manager of Shell Lubricant China.

In July, Shell celebrated the opening of its 100th high-end auto service store. Now Shell has 1,200 chain stores in China.

ExxonMobil last month opened a new Mobil 1 Car Care Outlet, bringing to 1,000 the number of the company's professional car maintenance outlets in the country.

"The opening of the 1000th outlet affirms the expansion of the Mobil 1 Car Care Outlet network and brings ExxonMobil a significant step closer to its commitment of enabling trouble-free driving nationwide," said James Hennessy, vice president of ExxonMobil Lubricants & Petroleum Specialties Co.

Growing demand

Statistics show that in 2008, the lubricant market demand in China was about 5.5 million tons, behind only the United States.

That demand in China is estimated to increase by 3.5 percent annually to 2013, making the country the fastest-growing market in the world.

Research shows that, as China's vehicle population registers 10 percent-plus annual growth, there is huge potential for the car care market.

The scale of China's auto aftermarket sector is about 100 billion yuan per year currently, a figure expected to reach $23 billion (157 billion yuan) in 2010.

"That's why, although the whole automobile industry was enduring a downturn last year, we still made a huge investment in the China market and continue to build our brand," Hennessy said.

"To reap the benefits of the market, ExxonMobil will customize services that truly benefit car owners. Building a foothold in China means continuously enhancing our investments in China, improving our span and network and continuously improving service," Hennessy said.

The Mobil 1 Car Care Outlet network has rapidly expanded since its entry into the China market, with 100 outlets by 2006, 500 by 2007, 800 by 2008 and 1,000 by this fall.

"We see the tremendous growth of the domestic auto market in recent years, but we also see a large number of first-time car owners here who have little experience in maintaining and repairing their cars," Hennessy said.

"We realize that to win in China, we have to grow in two ways, with good products and professional service," he said.

Hennessy said establishing high trust and customer satisfaction levels have been critical to ExxonMobil's market strategy.

"Our interaction with Chinese car owners allows us to hear their needs and respond with improved products and comprehensive service," he said.

Given China's vast geography and extreme driving conditions, he said it is necessary to help car owners respond to variable driving conditions and provide products adapted to local markets.

Hennessy said the Mobil 1 Car Care Outlet network has evolved from offering simple oil changes to service centers that offer a greater variety of services, including the latest diagnostics equipment operated by skilled mechanics.

The outlets also feature computerized maintenance records that can be accessed by car owners at any of the 1,000 stores.

(China Daily 11/23/2009 page8)