ILMA Compoundings - April 2019 - 5

LETTER FROM THE CEO

Notes from ALMU

n a big step forward for the global lubricants industry, the Asian Lubricant Manufacturers Union (ALMU) held its inaugural Annual Meeting and Global Leadership Summit in Singapore this March. I was proud to be a member of the ILMA
delegation that attended the first meeting along with ILMA President
Barbara Kudis, Board members Beth Ann Jones and Mike Damiani, and Global Affairs and Trade Chair Ron Powell and
Vice Chair John Campbell. Attendees from around the world were welcomed by Dr. Tan Wu Meng, the senior parliamentary
secretary of Singapore's Ministry of Foreign Affairs, Trade and Industry. Congratulations to Vicky Villena-Denton, editor-in-chief
and publisher at Fuels & Lubes (F&L) Asia, who worked tirelessly for many years to launch the association.
You might be wondering what was on the mind of ALMU members. ALMU attempted to answer two big questions during
its educational sessions: (1) How is industry preparing for the "digital transformation?"; and (2) counterfeit oils - how big is
the problem?
The concept of digital transformation sounds important, but what exactly does it mean? Digital transformation (DX) is
the novel use of digital technology to solve traditional problems. Richard Jory, vice president of the lubricants supply chain at
Shell International, explained to conference attendees that digitalization has the potential to improve the efficiency of lubricant operations. Examples of this in practice at Shell include improved visibility of its supply chain and increased transparency
resulting from digitization.
Other digital trends discussed included e-commerce, manufacturing automation (also known as Industry 4.0) and the
evolution of consumer preferences toward automated vehicles, ride sharing and electrification and away from the traditional
internal combustion engine. Of course, ALMU members are keenly interested in electric vehicles given the pending mandate
by the Chinese government and the growing interest of Chinese consumers, who bought 1 million EVs last year.
Counterfeit oil also attracted strong interest as attendees were told by BP's Sharmini Lohadhasan that "counterfeit
oil won't disappear anytime soon." Lohadhasan suggested that working more closely with customs officials could help
reduce the flow of counterfeit products coming into Asia. She also suggested that online and social media sales of lubricants
have enabled counterfeiters who generate high margins "in the range of 100-200 percent."
Education aside, by far the greatest value from the meeting was the opportunity to share and learn from representatives
from around the world. There's no question that the business challenges faced by Asian lubricant manufacturers are unique,
and hearing about them directly put into perspective the issues faced here in the free enterprise culture of the U.S. For ILMA
members considering expanding their operations into the Far East, there's no substitute for networking and learning from
others. A membership in ALMU and a trip to a future meeting would be a sound investment.

Holly Alfano
Chief Executive Officer

ILMA Compoundings - April 2019

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