Amazon, the company that will probably be the only place to buy anything in the future (much like how Taco Bell will be the only restaurant in the future, at least according to Demolition Man) has a line of self-branded products called Amazon Basics. It’s mostly filled with things people need but aren’t too brand-conscious about: batteries, pens, coat hangers, that kind of thing. Now motor oil is that kind of thing, too.
This is a big deal for the motor oil industry, which Forbes says is “ripe for disruption,” a phrase I will not say out loud. Valvoline stock has already dropped as a result of Amazon’s announcement. A Marketwatch report suggested that Amazon’s oil was about $3.56 per quart, Valvoline was selling comparable oil at $9.49 per quart, which is a huge difference. Still, looking today, I see Amazon Basics synthetic oil selling a five-quart bottle of 5W-30 for $17.27, while Valvoline has a similar synthetic for sale at $22.97, and a synthetic blend for $17.97:
That’s less dramatic price difference, so perhaps things are already changing.
Amazon selling private-branded oil is a big deal because they’re able to sell the oil much cheaper than most of their competitors, and, really, most people just don’t give a shit about what brand oil they use. Sure, there are those who insist that one particular kind is much better, but the truth seems to be that more expensive motor oils just aren’t worth it.
With all this in mind, motor oil is a great market for Amazon to get into: it’s effectively invisible to the outside world when in use, it’s something people are happy to just have delivered to their home, and it’s not a commodity anchored by brand loyalty.
This is all just getting started, so it’ll be interesting to see how this shakes out. In the meantime, we can all sit back an wonder when an entire, delivered-to-your-house Amazon Basics car will be available for people who just don’t give a shit about what they drive.