AMSOIL is forced to implement an energy surcharge

[Robert1955]

Originally Posted By: LargeCarManX2
I really hate to make this statement, but....Amsoil had better find a way to lower it's overhead. They recently expended a large capital investement in the future of the company. But, growing can cause pains in an enviroment that the world is in now. You can't keep passing on the cost of doing business to the customer every time. Cost cutting, lay-offs, maybe the CEO and other executive pay needs to be RE-AUJUSTED? You Think?

First I think Amsoil's overhead is the lowest of any major automotive oil manufacturer. After all its not like they have a pension plan to fund, a medical plan to keep an eye on, and buildings across the country with sales people maning the phones making sales and so forth. Most of their employees(?) like Gary and Pablo here have no real ties to the company in the normal sense of an employee to company relationship. And as for a company not being able to pass its cost of doing business on to the customer please get the gas stations and medical fields to follow that line of thought.

I hope you take a min and really think about what you typed here. I see it as a way for Amsoil to keep their prices as low as they can for as long as they can and not be locked into a price structure higher than they need, or lower for that matter for longer than 30 days. I have faith in Al and company they are really looking out for everyone, us as customers and themselves to be able to continue to provide us some of the finest, if not the best products for our vehicles.

 

[dargo]

I agree but with a JIT attitude this is the effects of it. I like their products but they should posts what there CEO etc make and what are there bonus, perks etc while they increase product prices...YMMV

 

[DragRace]

Thinking of this this morning...

Whats the point of being a PC if Amsoil is gonna keep raising prices when they see fit?

Was talkin to a few people yesterday and they aren't happy either.Keep it up Amsoil,you WILL lose customers.

 

[Pablo]

From a thread below in another forum, not related to Amsoil:

Quote:
The local pretzel joint asserts that it's the flour costs and not the energy costs that make them raise the price almost weekly.


Are you guys angry at the food producers as well? Your local bakery? How about the gas stations? UPS has a energy surcharge - and yes my instant gut reaction was to be angry at UPS. But I calmed down and thought it through. I can work around it to some extent, but some cost will swallowed and some will be passed on to the customer, as ALL companies will do.

I certainly can see why we all should not be happy about any prices going up.....but why single out Amsoil? Robert makes a level headed post above. Is Amsoil supposed to be the only company to not rise prices?

I can tell you Al started Amsoil by himself and has been at it over 35 years. He makes a lot of money, sure. But not an obscene amount. There aren't a whole ton of people near the top. 3 or 4. May some of them top out in six figures. (big whoop) It's a successful company. Is that a problem? How about outgoing (often times means FIRED) CEO's who get handed $50,000,000 plus severances for companies performing like [censored]? Those costs get handed (sort of invisibly) down to the consumer. Why doesn't that get you angry?

I tried to be straight forward posting the above information. For all our sake let's hope the dollar strengthens and our lust to BURN oil cools off.

 

[dargo]

I am not mad at UPS for the "Temporary Fuel Charge " but what gets me is when this become normal everyday $$$. When the price comes down does the fuel charge?

I know there are business online that have the same deal "Temporary Fuel Charge " but for the last 5 years it is common business. But what happened when the price of fuel dropped? Did the "Temporary Fuel Charge " come off, no....

I am not mad at Amsoil for this. But you better get better business people to plan ahead and put thse increase into once per year. I would rather have (1) jump in 1 year then everyother week. It was once per year back in the day with Amsoil. Then it was twice per year. Now going on three. Where does it end? What is next, monthly increases? So they increase it and then next month oil drops another $5. So does Amsoil reduce prices? That is my point.

But it can go the other way, if products are the same price for years, was the profit margin that huge they can keep it the same? Or are businesses wanting the std profit margin and want to keep it that way?

 

[Johnny]

Okay everyone, take a deep breath and relax. For someone who use to work for a large oil company, I will see if I can put some reasoning in to this for you.

First of all, Amsoil is not an oil producer. They buy every base stock, chemical, additive, and supplies from an outside producer. They take what they believe to be the best of the best of these and make their product, and from all counts they do a darn good job of it.

Now, be thankful that they have only had 3 or 4 price increases. What you do not know is what the major suppliers of additives and base oils are doing. The major oil companies (the ones that make the synthetic base stocks Amsoil uses) have had anywhere from 6 to 8 price increases per year for the past 6 years. The major additive supply companies like Lubrizoil, Afton, etc., seem to be having price increases on a monthly basis lately. Now since all freight companies seem to be adding fuel charges to everything, Amsoil has to pay those same fuel charges to get the goods so they can make their fine product.

Now, as for as the company, they have around 300 full time employees who have benefits like retirement and insurance. Has your insurance premium gone down, mine sure has not. And, as for as big Al disclosing his income, it's no ones business. Amsoil is a private company and does not have shareholders. I'm sure not going to tell you what I made, are you going to tell me what you make.

I've thought this for a long time so I might as well say it. You people (if the shoe fits wear it) go out and spend multiple thousands of dollars for a vehicle or vehicles and want to buy the cheapest thing you can and run it into the ground, then say the products no good. Pick the oil you like best (any brand) no matter what the cost and change it. It's the cheapest maintenance you can do to your vehicle to make it last.

Now I have to applaud Pablo for being upfront and honest. I will guarantee you no other oil company rep will come on here and do what he has done.

If you don't like Amsoil or brand xyz, pick a better reason than price.

 

[Steve S]

What bothers me is when I have to pay for NASCAR racing Or a sports team etc. when I shop somewhere or buy something.

 

[MinivanMauler]

I think what everyone here is objecting to are what economists call "static up, elastic down" pricing.

That is, when production/transportation costs rise, companies are quick to pass along those costs to the customer. However, then production/transportation costs fall, the corresponding price decreases are slow to follow, if they follow at all.

Gasoline refineries are notorious for this pricing strategy.

 

[oilyriser]

Amsoil needs to start pricing in and taking payments in e-gold or other real currency. Then they'll be able to have stable prices.

 

[DragRace]

The last thing I'll add is this.

Customers already pay the premium price for an excellent product.
When costs become start to become a rise and fall trend,people will become discouraged and stop using Amsoil just like any other product that follows that trend of pricing.

Like I said as well,there's a couple dealers that ARE NOT HAPPY and also PC customers,who I talked to about this,so in closing,I hope Amsoil is careful with this,or in the end,they'll lose customers,period.

 

[BarkerMan]

A spokes person for the LA Mayor's office said the cost of food for the poor is going up not because of the rising energy cost but because of the rising flour cost right after one of the owners of largest bakery in LA said the biggest increase in there cost was transportation. When the bakery passed on the increase to wholesale customers the law firm they use raised their rates to the bakery. The broker that handles the transportation for the bakery is now using the higher energy costs and an excuse for poor service on his part. The main supplier of trucks to the broker after charging a surcharge is now charging more for manual labor and fork lift drivers. The fork lift service company after changing their surcharge for their fuel costs is charging more for parts and labor for maintenance and repair. It just goes on and on. If energy costs level off or go down I doubt that any of these other rates will follow.

 

[buster]

Johnny made great points.

Amsoil really has no choice not to try and make the best oils they can otherwise AA/Walmart get the business etc.

Amsoil is a niche player and people that want the best will pay for it. Once quality drops, so will the customers. Over the last 5 years, Amsoil's quality has gone up IMO, not down, all while raw material prices have gone up. I think Pablo would agree with me here.

DragRace, if their prices go up, use another brand if you want. No one is forcing you to buy Amsoil. It's when they drop the quality will customers go elsewhere. No one wants to "mail order" oil that is on par with what is available retail. Premium products cost more, always have always will generally speaking.

People should also take advantage more often of actually extending the drain intervals instead of 6k mile drain intervals.

 

[Robert1955]

Originally Posted By: dargo
I am not mad at UPS for the "Temporary Fuel Charge " but what gets me is when this become normal everyday $$$. When the price comes down does the fuel charge?

I know there are business online that have the same deal "Temporary Fuel Charge " but for the last 5 years it is common business. But what happened when the price of fuel dropped? Did the "Temporary Fuel Charge " come off, no....

I am not mad at Amsoil for this. But you better get better business people to plan ahead and put thse increase into once per year. I would rather have (1) jump in 1 year then everyother week. It was once per year back in the day with Amsoil. Then it was twice per year. Now going on three. Where does it end? What is next, monthly increases? So they increase it and then next month oil drops another $5. So does Amsoil reduce prices? That is my point.

But it can go the other way, if products are the same price for years, was the profit margin that huge they can keep it the same? Or are businesses wanting the std profit margin and want to keep it that way?


I think you already had your answer in Pablos posting of the information Amsoil provided to its dealers.

"By doing so the company will not have to continue re-issuing price lists to all customers, and it should help avoid changing discount schedules, freight schedules, etc., until some semblance of stability returns to the market. That way if our costs were to come back down we would not have to lower prices but could simply lower or eliminate the energy surcharge."

Like I said in my first post I think this is a good way for Amsoil to react very quickly to a change in prices. Both UP and DOWN. I know the major oil company owned gas station down the street from me always drops their prices when the price of oil drops, just like they would never raise it the next day when the price of oil jumps $5 and that oil they just bought will not hit the gas pumps for 6 - 8 weeks

. I don't like paying more than needed for anything myself so I am not sitting here cheering for a 7% surcharge but I can see the facts when they smack me in the face. Anyway how about those 35,000 OCI's

 

[buster]

You also have to remember that all the other brand prices are going up too, not just Amsoil. It's all relative.

 

[XS650]

Originally Posted By: BarkerMan
If energy costs level off or go down I doubt that any of these other rates will follow.


That's on in Amsoil's favor. They are sticking the oil based cost increase out there like a big ol' wart on their nose. That tells me they plan to drop the extra charge when crude prices drop.

Other companies that just roll the crude price increases into their retail price can be expected to not drop their prices if the price of crude drops

 

[ThirdeYe]

I made sure to put in my order today before the prices go up (if they haven't already, I haven't been keeping tabs on the prices)

 

[o2man98]

Originally Posted By: DragRace
The last thing I'll add is this.

Customers already pay the premium price for an excellent product.
When costs become start to become a rise and fall trend,people will become discouraged and stop using Amsoil just like any other product that follows that trend of pricing.

Like I said as well,there's a couple dealers that ARE NOT HAPPY and also PC customers,who I talked to about this,so in closing,I hope Amsoil is careful with this,or in the end,they'll lose customers,period.


You make it sound like no other motor oil has had price jumps in recent years. Conventional Pennzoil was under $1 in 1998, now over $2. If you do the math that is over a 100% price increase. Amsoil is notifying dealers and customer over a month in advance of a 3-7% increase. Now THAT should get respect right there. Keep an eye on the oil shelves at your local WalMart and you see a nickel jump here and a quarter jump there with no notice or explanation. Jump on their backs.

Someone mentioned if oil goes down $5 will Amsoil lower prices? Well, considering they gave a Canadian discount of 10% a few months ago due to the then current currency exchange rates I would have to say yes they probably would.

Why be a PC as asked above? Well, as PC you still get your discount. They are not taking that away are they? It is foolish to ask such a question when the answer is right in the purpose of the option itself.

 

[buster]

o2man is right.

Oil is still cheap compared to other goods/services. Stop complaining.

I paid $62 for 6qts of SSO. Even if I only run it 10,000 miles, that's $124 a year, $10 a month.

 

[cosynthetics]

You can always leave Amsoil if you want, you'll still pay a lot for oil. Mobil 1 is up to 6.48 at my local autozone. It's been raising by leaps and bounds.

I'm tired of all of this stuff raising so fast. I wish the dollar, oil, and the housing market would stabilize. My infant's cereal just took another price increase, diapers jumped by $4 a box, and my kid's juices jumped over .50. Everything is up and it stinks. It hurts.

 

[Steve S]

Originally Posted By: cosynthetics
You can always leave Amsoil if you want, you'll still pay a lot for oil. Mobil 1 is up to 6.48 at my local autozone. It's been raising by leaps and bounds.

I'm tired of all of this stuff raising so fast. I wish the dollar, oil, and the housing market would stabilize. My infant's cereal just took another price increase, diapers jumped by $4 a box, and my kid's juices jumped over .50. Everything is up and it stinks. It hurts.
Welcome to the 1970's