Quick Lube Concept Expanding Internationally

Quick lube shops may seem to be on every corner of most major American cities, but that's not true overseas in places like China and even north of the border in Canada.

Shell Oil Company, which owns Jiffy Lube, and Chinese automaker Shanghai Automotive Group Co. have joined to create a chain of Jiffy Lubes throughout China. The new joint venture, Anji Jiffy Lube Automotive Services Company Limited, is now building a network of fast lube service outlets modeled after the Jiffy Lube chain in North America. The outlets, which will offer motorists convenient, Jiffy Lube branded preventive maintenance services, are a new concept in car maintenance in China.

This is not the Quick Lube concept's first foray into international waters, as organizations like Grease Monkey and Meineke Car Care Centers have franchises in Mexico and Canada, respectively.

In fact, late last year, Meineke Car Care Centers, through an agreement with Network Franchising International (NFI), began a major expansion initiative in Canada.
"There have been significant changes in the Canadian auto repair industry," said Ken Walker, president & CEO of Meineke Car Care Centers. "We feel it's the right time to aggressively grow our chain in Canada."

A great opportunity with unlimited potential is how Bruno Piva, NFI's account manager for Meineke Canada, described it. "Meineke has nearly 900 franchises worldwide, with exceptionally strong brand awareness, and offers an exceptional franchise business opportunity for astute entrepreneurs," said Piva.

Meineke is well established south of the border, but huge growth potential remains in Canada.

And officials with Shell and Shanghai Automotive see growth potential in China, where there is a rapidly growing fleet of automobiles, but few if any quick lubes. China now has 23 million vehicles on its roads, and sales of new vehicles have been growing at high double-digit rates - fast enough to have made it the third-largest market in the world in terms of sales. As a result, the automotive products aftermarket is growing fast.

"The strength of this partnership lies in the experience that each party brings to the joint venture," Shell Lubricants Chief Executive Officer David Pirret said. "SAISC provides a high profile and expertise in the Chinese motoring market, while we offer premium quality Shell Helix lubricants and Jiffy Lube, the leading brand in automotive preventive maintenance services in North America, as well as the technology and experience of running a successful fast lubes operation for 25 years. This partnership enables us to continue our downstream growth in the service industry and expand into a brand new market."

The companies said they plan to build approximately 10 pilot locations in Shanghai and then to expand to Beijing and other parts of China. Outlets will be modeled on the Jiffy Lube concept, offering oil changes and other preventive maintenance services to customers while they wait.

Looks like oil really is an international commodity.

Published: October 11th, 2005

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