Motul & Vilube | Innovation, Excellence and Agility!

On this episode of Friday notes at The Lotus Talks, Granger Whitelaw Is joined by returning guest Keith Schulz, EVP of Motul & Vilube, who oversees 15 Countries in APAC and has seen great success with the brands. Keith shares his experience with us, and what the Companies are doing In the ASEAN markets and beyond. We hope you enjoy this profile on an exciting company, that Is not only successful but giving back to society.

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Below is a transcript of the episode, edited for readability.

Listen to the full episode at link below.

 

Granger Whitelaw: Good morning.

Granger Whitelaw with Lotus talks. It’s Friday morning here in Vietnam and it has been a really busy week. Lots going on. I know for sure I have been busy. I want to welcome our guest today, Keith Schulz from Motul. Keith, Thanks for joining me again.  

Keith Schulz: Thanks Granger, happy to be here.  

Granger Whitelaw: The podcast Monday was great. your, your thoughts were really insightful and got really good response. so thank you and I’m glad you came back on as a guest today.   Keith Schulz :  Gladly.  

Granger Whitelaw : How was your week You traveled all around and I hear that the airports are kind of empty but the planes are somewhat full and it’s not business as normal, but there’s activity.  

Keith Schulz: There is a, they’re not all empty, easy to get a hotel room, flexible bookings on airlines. but business carries on and even in countries like Singapore that are a little more impacted than others.  

Granger Whitelaw: Sure. It’s encouraging I know, I know that, the hotel are down like 80%. I’ve heard in in other travel places like Vietnam and Nha Trang and Danang, and around and it makes sense. Right You want to be quarantined. Schools are off again. So your kids have been off now for a month or,  

Keith Schulz: yeah. Yeah. Since before Tet. Yeah. And Christmas break before that. That’s driving parents a bit mad.  

Granger Whitelaw : Every kid’s dream.  

Keith Schulz : Yes. Yeah. How come that didn’t happen when I was in sixth grade,   Granger Whitelaw: I think we had a snow day. Right. You grew up in the Midwest. I grew up going sledding – it was the best!  

Keith Schulz: Yeah, that was great. This is a little different program. Even my kids now they’re starting to think, Hmm, maybe school wasn’t so bad too.  

Granger Whitelaw: Yeah. They miss their friends. Right. My daughter CC really like, you know, she was ready to go back to school cause she got, if you remember, I was home with the States and then she got mono and then she got the flu. So the first week she couldn’t even go back to school and she was ready to go see her friends after a month.  

Keith Schulz: yeah. All parents in four provinces in Ho Chi Minh City and you know, right here at home among them are indefinitely closed as far as school goes  

Granger Whitelaw: crazy. So I want to talk about Motul today. You, are, I mean you have a new position at Motul. I know it’s a, it’s a big, big position and a big responsibility. so what is your title now or titles and..  

Keith Schulz: I, well, I still live and work here in Vietnam, based here, but, I’m Executive vice president for Asia Pacific, which is basically all of Asia outside of Japan, China, India.  

Granger Whitelaw: Okay.  

Keith Schulz: That covers all of the products. you know, we divide it primarily by, automotive where our brands most well known, but also industrial and heavy duty. And so, especially in those last two categories, we’re making a big push to be more aggressive and, and carve out a bit of a niche.  

Granger Whitelaw: Right, right. So Motul has been around since 1853, I guess it’s kind of a cool story, how you guys started and the industrial revolution had just turned the world upside down, right and Motul. They say this is from your website, sees the opportunity by focusing on innovation and excellence and take us to considering every step of an industrial process and envisioning automotive growth. You didn’t aim just to create the right oil for the right purpose. You aim to harvest its knowledge and gain at every step. And this is really what you guys do. You look at inventing, you look at, creating new products. you’ve had a lot of firsts  – in ‘53 You’re the first multi grade lubricant in ‘66 you had the first semi-synthetic lubricant for cars in the world, ‘71. You had the first fully synthetic forced or lubricant, esthers, and a lot of other huge things recently, You have a hybrid range on the market for oil and synthetics. That’s so cool. I mean, it must be fun. I mean, people think it’s boring oil, but it’s not. It’s cool technology.  

Keith Schulz: Yeah. We interact really closely with our end users and use racing as the basis for a lot of our development. So, in the USA eh, our brand is not all that well known, but if you are, at a club or a national level, two or four wheels, our product, is kind of a, a key reference. whether it’s a specific racing oil or the 300 V, we have built a lot of our reputation about what that offers in a racing environment. High tech,  

Granger Whitelaw: High tech – the movie we saw a Ford versus Ferrari, right Yeah.  

Keith Schulz: We had Cameos  

Granger Whitelaw: You guys at Motul had some cameos. Right!  It’s so cool to see your brand in the history. I mean, you know, you’ve been around for a long time. It’s a trusted brand, but it’s a high end – for Maserati for Ferrari, for that’s really where it kind of started. Right. And now you’re, you’re a broad-based product for, for motorcycles, you know, 11,000 stores sell your stuff in Vietnam alone. I mean, it’s huge growth.  

Keith Schulz: Yeah. Yeah. It’s been a good story in Vietnam. the, concept to come in – to Vietnam with a local partner, I think made a lot of sense. There are a lot of technical imported brands from Europe, but here, we’ve built, founded a beachhead and built it up, as the production and development hub for all of Asia.  

Granger Whitelaw: Oh is that right?  

Keith Schulz: A little bit unique. Yeah. Right here in Vietnam. Most, companies would have chosen Singapore or China for that, for technology or market access region reasons, but we go about things a little differently, and liked what we found with the raw materials as far as the factory and the team, going back to the mid 2000’s,  and in the last 15 years, have built what was originally, just a local brand and blender Vilube Corporation.  

Granger Whitelaw: Vilube right. That’s the Vilube brand here.   Keith Schulz: That’s right – and now that’s become a really integral part of the global operations where, for example, in our metalworking fluids, you know, the coolant that goes into machining, precision parts, all of the R&D for all of Asia happens right here in our lab, next to our factories in Ho Chi Minh  

Granger Whitelaw: that’s in district seven.  

Keith Schulz: Yes. Just South of there and yeah.  

Granger Whitelaw: That is so Cool. I had no idea. that is really neat. So you do a lot of research here as well as the blending.  

Keith Schulz: Yeah. And that is a bit of a differentiator because, I even on the automotive side, a lot of our competitors, don’t, develop and manufacture the fully synthetic products for cars or bikes. but we started with that right in the beginning. We defined all the processes in the supply chain, and have been blending that for several years and carved out a really significant market share, although it’s a fairly small market, for the high-end synthetics, you know, right in the beginning, as part of the strategy.  

Granger Whitelaw: So you guys sell, I mean you’re the Motul stores are all over easy Vietnam for the bikes, right. But you also do the industrial products as well for Asia. And do you manufacture that from here as well or  

Keith Schulz: certainly, yeah, we, develop and blend that in the same plant. the brand is called Motul Tech. And strategically, it makes a lot of sense for us to look down the road on where lubricants are going as more and more drive systems are less conventional and we’ll use less lubricant in the future. But as far as factory operations, there will always be two pieces of metal touching and interacting and then her requirement for a certain substance to make that optimized.  

Granger Whitelaw: So you don’t, for for sure I factories need oil and they need lubricants. You gotta you gotta have it to make stuff. Right. So yeah, you don’t oversee China any longer. I thought you had some oversight in China before, but that’s got to be a big issue right now. We talked about Monday supply chain and what you guys are thinking and how are you dealing with that Maybe you can share some of your thoughts since you have so much experience in that territory with others listening to show who don’t.  

Keith Schulz: Yeah. I also have another hat, as head of strategy for the industrial loop side. And we are focusing on process-oriented fluids in China. This is not the ideal time to be working directly with factory end users. but we think, adding value, through both the product, that is customized for individual applications, individual factory situations. And then the follow-up service in cleaning analysis, based on a total cost of ownership model really is the right way forward. many of our competitors are already entrenched there and so we have to find ways, not just on the product, but on the service and logistics side to differentiate from them. And the service high touch angle is a big one, even in a massive market like China.  

Granger Whitelaw: Sure. And right now your factory that was closed, you’re not operating or are you operating part time or how do you operate?  

Keith Schulz: well, we are working from home and our sales team is operating a limited scale, but it’s mostly laying the groundwork for when our factory customers and our distributors open up. And that’s happening in dribs and drabs over the past week.  

Granger Whitelaw: Well, that’s good. So, so it’s starting and they’re seeing indication.  

Keith Schulz: There are some signs of life, yes.  

Granger Whitelaw: Yeah. I mean it’s, it’s been scary for everybody. And, obviously you’re operating in 15 countries here or something and so you have some, probably resources and abilities to do things Others don’t. I remember we were speaking with the head of Intel last week and he was saying, Oh, well, you know, but I have my own ability to, you know, get cargo planes to fly here and there and move my product or move it to different factories. And, and having that ability is great. Right But if you don’t have that ability, it can limit your, your growth potential this year. I think.  

Keith Schulz: Yeah, especially now. I think, it’s time to do more thinking about the eventual opening of, most of the impacted areas across the economy and that industrial lubricant side. those are, the factories that are either, currently not in operations like in China or those that are outside, but rely on inputs from China that just don’t have the materials to restart a lot of their manufacturing operations. And so, we’re in a lot of communication, different forms, formats, so that we can ensure that we’re first in line, with, the supplies that we need to manufacture on our own. Sure. But that we help our customers get first in line in their materials sourcing. So they also open up as early as possible because I think, over the next couple of weeks and months you’ll see some serious shortages in certain areas. Now, a lot of that I think is fear based, but soon it will be real – across a lot of areas in supply chain and the big one is automotive out of China. So if we can help our customers or restart before their competitors and that’ll be an advantage for us and, we’re looking to capture a little bit of additional market share for sure.  

Granger Whitelaw: Yeah.. As we said, Monday, there’s opportunity that comes through, through a hard times and thoughtful, strategy and thinking can make a big difference in even a little bit can make a big difference. Right Yeah. Fuel is definitely a concern, right We want to get fuel, you need to get oil, you need some of those necessary things. And you guys are definitely part of that, that supply chain, right It’s necessary for the economy to keep moving –  the engine of the economy to keep moving. So no pun intended –  but maybe,   Keith Schulz: yeah. Yeah, that’s a big deal for us. We only have a few of the inputs, coming from China, globally in lubricants. South Korea is taking the lead on base oil. they seem to have two or three, chaebols that, are kind of benchmark in price and quality. And so far the supply lines, there are ok — a lot of chemicals sourced in the U S and Europe as well. And so, they’re just hoping that their sales to Asia, aren’t all that impacted. But, we’re ready to produce, as fast as , the customers that are willing to take the product.  

Granger Whitelaw: Another cool thing about your company, I noticed, I watched the TechcomBank, run a couple of months ago, Actually, I guess December like eighth or ninth. And you ran in this event and it’s a huge event here in ho Chi Minh city. And I think I saw like 100 Motul shirts or something like that, how many of your employees, ran in that event  

Keith Schulz: Well, it wasn’t quite a thousand, but we did get to 160. That’s a lot. It is a lot. That’s about 60 – 70% of our employees here in Vietnam. And many of them had never run five K before. And so that was encouraging and the feedback, was that, the training was hard and the race, was more fun than they’d expected, especially when they could do it together after putting in the effort.  

Granger Whitelaw: Yeah. Team building. Right. You guys do a lot of charity too, right You, you, you, you’re very charitable focused.  

Keith Schulz: Yeah, we’ve got a great HR team that, double hats as our CSR operations and in the last year, our effort has been on rural schooling. So, we’ve sent teams to 4 kind of remote corners across Vietnam, and sponsored and participated in the building of four schools…. and we’re going to double down on that 2020.  

Granger Whitelaw: That is so cool, You build the schools. That’s awesome.   Keith Schulz: Yeah, that’s fantastic. Yeah, I agree that that’s meaningful. We think there, those, kind of remote, provinces where teachers are ready and willing, but don’t have any infrastructure or place to collect kids, and electric or running water to go along with that, need that kind of help.  

Granger Whitelaw: That’s so cool. That’s awesome. A great example of companies like we like to talk about here and on The Lotus, people are giving back. You know, it’s, it’s great to do well, but you know, do good too if you can. And certainly you guys are a shining example of that at Motul & Vilube….. You looking forward to this year and you think in the end it’s all going to work out? Are you feeling positive? –  Any glimmer of hope for those listening?  

Keith Schulz: Yeah. Despite, a lot of the headlines today, now I think it’s going to be a very good year. I think, this requires some agility even from the big players that, they haven’t had to rely on in the past two or three years where conditions generally in Vietnam have been only up, up, up, up, up. Yeah. And so here you demand some more fine tuning now, which is why we’re maybe in the mode with our thinking caps on, but, when it does come back, I think refilling stocks with, value added offers, is going to play into our hands. and so we’re optimistic cautious now, but optimistic across the 16 markets that I see. China I think will be a special case and I’m glad we have a strong GM up there who, is on the ground full time…. Even if you want him to go out, he couldn’t.  

Granger Whitelaw: All right.  

Keith Schulz: but outside of that particular market, I think, Asia is set for a pretty good run and we’ll see what happens and how things respond too. you know, issues around the US election, for example, macro issues. But on the ground, there’ll be plenty of progress  

Granger Whitelaw: I know there’s a big new EU agreement to sign for Vietnam and there’s, there’s so many positive things happening here. I think that you’re going to see a lot of growth and a, it’s still the fastest growing economy in the world. And, and  obviously you are very thoughtful and figuring out ways to restart and help your, your clients and customers restart as well as very thoughtful and, and I think, the more people look at that approach, try to  figure out how you can really add some value to your consumers, to the retailers, to the end users when it really starts to get going. We can, we can jumpstart this thing again and hopefully make up some time on lost ground for the economy.  

Granger Whitelaw: All right, everybody out there. Thank you for listening. It’s the Lotus talks Friday afternoon. and key, thank you so much for coming. I really appreciate your time. Your time is incredibly valuable. I know and I appreciate you all your thoughtfulness and generosity.  

Keith Schulz: Thanks for having me on Granger.  

Granger Whitelaw: Yeah. Yeah. Everybody out there have a great weekend. take care of yourself. Have a great time with your families. Make sure you keep, those hands washed as I like to say. And, enjoy the time off until Monday. It’s Lotus Talks…  

The Lotus Talks is produced by The Vietnam Group and Hosted by Granger Whitelaw.
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