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Oil Change Retail - US - January 2018

OVERVIEW
What you need to know
Definition
EXECUTIVE SUMMARY 
Overview
The issues
Nearly half of car owners don’t always adhere to recommended oil change intervals
Figure 1: Oil change behavior, October 2017
Synthetic oils increasing mileage intervals between oil changes
Figure 2: Recommended mileage between oil changes for 2000 and 2017 Toyota Camrys and Ford F150s
Oil change market extremely fragmented and competitive
Figure 3: Oil change location, October 2017
The opportunities
Americans are driving more than ever
Figure 4: Vehicle miles traveled, 2000-16
Only two in 10 car owners know how to change their own oil
Figure 5: Oil change behavior, by gender, October 2017
Car owners tend to use the same location for oil changes
Figure 6: Oil change behavior, by age, October 2017
What it means
THE MARKET – WHAT YOU NEED TO KNOW
Oil change retail market forecasted for growth
Americans driving more than ever
Average age of vehicles on the road over 11 years old
Low fuel prices keep Americans driving
MARKET SIZE AND FORECAST
Oil change retail market forecasted for growth through 2022
Figure 7: Total US sales and fan chart forecast of retail oil changes, at current prices, 2011-21
Figure 8: Total US revenues and forecast of automotive oil change and lubrication shops, at current prices, 2012-22
MARKET PERSPECTIVE
Electric vehicle adoption threatens oil change retail segment
MARKET FACTORS 
Vehicle miles travelled continues to increase
Figure 9: Vehicle miles travelled, 2000-16
Low unemployment and high consumer confidence will deter DIY oil changes
Figure 10: Consumer confidence and unemployment, 2000-November 2017
New vehicle sales today mean service revenues for dealers tomorrow
Older vehicles likely to need additional oil changes
Figure 11: Average age of light vehicles in the US, 1995-2016
Synthetic oils increasing mileage intervals between oil changes
Figure 12: Recommended mileage between oil changes for 2000 and 2017 Toyota Camrys and Ford F150s
Gas prices remain stable for the time being
Figure 13: US gasoline and diesel retail prices, January 2007-December 2017
KEY PLAYERS – WHAT YOU NEED TO KNOW 
Dealerships hold majority of retail oil change segment
Tire-focused retailers losing market share
Nearly a quarter of shoppers used an alternative source for an oil change
Electric vehicle adoption threatens entire oil change market
COMPANY AND BRAND PERCENTAGE OF RETAIL OIL CHANGE
Dealerships, Jiffy Lube, and Walmart lead oil change segment
Figure 14: Market share of oil change locations, by consumers who have purchased an oil change in the past 12 months, July 2016-August 2017
WHAT’S WORKING?
Dealerships and Valvoline see largest gains since 2013
Figure 15: Oil change locations used in the past 12 months, by consumers who have purchased an oil change, 2013-17
Figure 16: Temecula Nissan direct mail, December 2017
WHAT’S STRUGGLING?
Tire retailers losing market share in oil change retail
Figure 17: Goodyear acquisition email, March 2017
Branding plays a minimal role in car owners’ decisions
Figure 18: Oil change retail location reasons, October 2017
WHAT’S NEXT?
General Motors “Marketplace” to allow car owners to book oil changes from their dashboard
Electric vehicle adoption will negatively impact oil change retailers
THE CONSUMER – WHAT YOU NEED TO KNOW 
Most don’t know how to change their own oil
Cost and location are main reasons behind location choice
Most car owners agree they usually go to the same location
New car buyers more likely to go to the dealership
AUTO MAINTENANCE OR REPAIR SERVICES
Nearly eight out of 10 get an oil change professionally done
Figure 19: Auto maintenance or repair services, October 2017
Figure 20: Christian Brothers Automotive, direct mail, October 2017
VEHICLE MODEL YEAR
One third of vehicles serviced are less than five years old
Figure 21: Vehicle model year, October 2017
Figure 22: Vehicle model year, October 2017
PURCHASE TYPE
Nearly 60% of vehicles serviced were purchased new
Figure 23: Purchase type, October 2017
Purchase type correlated with age and income
Figure 24: Purchase type, by age and income, October 2017
OIL CHANGE LOCATION
40% of car owners took their car to the dealership for an oil change
Figure 25: Oil change location, October 2017
Used car buyers more likely to go independent or alternative retailer for oil changes
Figure 26: Oil change location, by purchase type, October 2017
Figure 27: Keenan Honda certified pre-owned sales event, acquisition email, September 2017
Walmart and smaller firms see success among rural residents
Figure 28: Oil change location, by area, October 2017
LOCATION REASONS
Location the most important when it comes to oil changes
Figure 29: Oil change retail location reasons, October 2017
TURF analysis for new car buyers
Figure 30: TURF analysis – Oil change location reasons, October 2017
TURF analysis for used car buyers
Figure 31: TURF analysis – Oil change location reasons, October 2017
Jiffy Lube winning on location, Walmart winning on cost, dealerships winning on trust and quality
Figure 32: Location reasons, by oil change location, October 2017
OIL CHANGE BEHAVIOR
Majority of car owners don’t know how to change their own oil
Figure 33: Oil change behavior, October 2017
Men more likely than women to know how to change the oil and have a preferred brand
Figure 34: Oil change behavior, by gender, October 2017
Younger shoppers look at reviews online, but aren’t scheduling online
Figure 35: Oil change behavior, by age, October 2017
Figure 36: Jiffy Lube, direct email, November 2017
Parents less patient when it comes to oil changes
Figure 37: Oil change behavior, by parental status, October 2017
Used car buyers less likely to adhere to recommended intervals
Figure 38: Oil change behavior, by purchase type, October 2017
FACILITY AMENITIES
WiFi is a must have for the waiting room
Figure 39: Facility amenities, October 2017
APPENDIX – DATA SOURCES AND ABBREVIATIONS
Data sources
Sales data
Fan chart forecast
Consumer survey data
Consumer qualitative research
Direct marketing creative
Abbreviations and terms
Abbreviations

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