Amazon is now in the oil business. With the release of its Amazon Basics Synthetic Motor Oil, Amazon has effectively entered into an industry ripe for disruption.
A report from Market Watch announced that shares of Valvoline Inc., sank 4.2% in premarket trading on Friday, September 14, after J.P. Morgan turned bearish on the engine maintenance products company, citing concerns over competition from Amazon.com Inc.
I anticipate that other press releases will become commonplace in the coming months as news about Amazon’s latest product and category entry gains publicity. Retail and business analysts always regard Amazon’s entry into a category as having a detrimental effect on established brands.
Although first available in July 2018, reviews of Amazon Basics Full Synthetic Motor Oil have just started to appear with most customers giving the product a positive review. Retail analysts tell me that they find it fascinating how Amazon will release one of its private label products with no fanfare or announcement.
The fact that Amazon has a released a private label product in a category most analysts and consumers believed Amazon wouldn’t compete, will become a big story.
Full disclosure: I used the Amazon Basics brand for my latest oil change and so far I have seen no difference in performance, horse power or mileage when compared with the more expensive motor oils I regularly use. Like many car owners, I prefer to keep a vehicle for a long period of time. My current SUV has over 100,000 miles on the engine. (Forbes story continues here)
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