WBO ’20: Lubricant additives industry should embrace change – Infineum CEO

LONDON (ICIS)–The additives industry should not under-estimate the role it has to play in making the internal combustion engine as clean as it can possibly be, the CEO of additive producer Infineum said on Friday.

“Embrace change. The rate of change has never been as fast as it is today, but it will never be as slow as this again,” said Trevor Russell.

“Decarbonisation will happen … but when is it going to happen?”

Electric vehicles (EVs) will become a slightly bigger proportion of the fleet each year, but internal combustion engines (ICEs) will be around for a very long time.

The existential threat to the lubricant business could be a long way off.

“The conversation about the future of the ICE is still immature. It’s got a long way to go. [There are many issues still unsolved like] Battery life, recharging, where the electricity is going to come from… A lot of investment is needed,” said Russell.

“What is the fuel to be for the power stations? 40% of the world’s power stations are on coal,” he said.

Infineum’s response is to model everything out to 2040-2050, using different scenarios.

“In all, the additive industry is bigger in 2040 than it is today. So we’re going to continue to invest, in technology and people … We want to invest in sustainability. We want to capture that growth,” he said.

Additive industry processes have been improving after various committees were formed to simplify processes.

“This industry is full of complexity, some of which is good for the industry, and some is bad. On the good side, a technical issue being solved by additive technology, that’s taking us forward,” he said.

“Bad complexity is in industry specifications where you measure the same thing in different ways, and engine tests which are hard to reproduce. Bad complexity leads to waste.

“I ask the industry: let’s streamline and remove complexity. It’ll be a marathon, not a sprint. It’s a mixed bag but I’m hopeful,” added Russell.

Reflecting on a number of upstream production incidents, which impacted on supplies to the Infineum business in the past year, he noted that the industry needs to take responsibility for the whole supply chain.

“The human tragedy, the massive costs to rebuild, and some businesses don’t reopen. We’ve seen all of that. I care from a human and business [perspective] … Supply integrity is on my mind for sure,” he said.

The CEO added that geopolitical events will influence decisions on where Infineum will invest.

“Middle East instability, the massive rise in nationalism versus globalism. The way that plays out is the US-China trade war and what that will do for our business,” he said.

“Another example is Brexit. We have 500 technology people in the UK. Will we have the same access to the same talent here? It’s a very diverse workforce. Will Brexit impact who comes to the UK to work?” he said.

Another key factor for the future of the lubricant additive business is the rising demand for mobility.

“There’s a very young population in China and India, and they demand mobility. There’ll be an explosion in demand for mobility. The impact on me is: where do I put my investment in the future?” he said.

The 24th ICIS World Base Oils and Lubricants Conference runs on 19-21 February in London.