Rerefined fluids comprise approximately 5% of the base oil market. They can often perform as well as virgin oils. Many factors determine the performance of a product, but often the factors can be equalized to manufacture competitive products.
- Specific Base Oils and Supply – most rerefiners are looking for Group II used oil to ensure the quality of the rerefined base oil. Group I products are usually from industrial applications rather than motor oil applications. As a result, the quality will be a little lower and the value of the product won’t be as great as using Group II products. Consequently, there may be some gaps in providing the specific base oil that rerefiners are looking for.
- Quality Controls – manufacturing processes and additive packages play a role in the final product. The quality of cleanliness can be a significant factor as well.
- Marketing – what is the manufacturer’s ability to market the final product? Keep in mind the end-user benefits of rerefined products (i.e. fewer emissions and less energy used when rerefining the product and less reliance on foreign oil).
- Government Regulations – most government entities are favoring the use of rerefined products.
- Cost – the price of virgin oils can make a big difference when considering the use of rerefined products. In the last few years, virgin oil prices have escalated making rerefined products more attractive.