2014

FROM THE RACETRACK TO OUR DRIVEWAYS: Shell and automakers leverage learnings from track to develop products for the road

HOUSTON, Sept. 26, 2013 /PRNewswire/ -- Consumer spending on new vehicles is at an all-time-high since 2007[a], according to U.S. auto industry reports[b] this month showing a rebound to pre-recession levels. For motorists taking the leap to replace aging vehicles (averaging a record 11.4 years[c]), they may find that vehicle options are vastly different. Yet one trend that consistently influences what consumers may see on the showroom floor is decades of race-inspired technology that has migrated from the track to road cars today.

The auto industry has always relied upon motorsports-borne technology as an innovation test-bed for road cars. Close collaboration between industry players helps develop parallel or complementary technologies and innovate with suppliers like Shell, a fuels and lubricants leader with a long motorsports history of applying lessons from the track to the road, to develop products that power and protect motorists globally.

"Our technologists create innovative lubricants that look to unlock greater fuel efficiency in a vehicle," said Istvan Kapitany, President Shell Commercial Fuels and Lubricants Americas. "For engine oils, the lower the viscosity of the oil, the less fuel you need to power your engine. The challenge is to determine the lowest viscosity that still provides the right level of engine protection, durability and performance."

Based on changing consumer demand and fuel economy standards, this synergy is more relevant as American road cars continue to implement innovations from the race track - with smaller, more powerful engines that deliver increased performance, fuel efficiency and lower emissions. With fewer regulations and cost considerations than the real world, motorsports is an open test ground for pushing industry boundaries and generating ideas or solutions that could have far-reaching impact on the future of mobility.

Today's racetrack as a laboratory for tomorrow's mobility

In its infancy, racing pioneered ways for cars to move faster, longer and safer, which new automakers inexpensively adapted for street vehicles. Today, motorists use decades of race-inspired technology ranging from full rear-view mirrors to performance tires to engine-cleaning fuel additives and advanced lubricants. Shell bridges both worlds with a diverse portfolio of race teams, drivers and series like IndyCar, NASCAR, MotoGP and Formula One, working in close technical alliances across an array of automotive and engine manufacturers.

To help drivers succeed at track and on the street, Shell and its technical alliances focus on three common priority areas:  performance, efficiency and innovation – with safety underscoring everything.

  • Efficiency: In racing, fuel efficiency can mean the difference between winning and not finishing the race. The auto industry now uses track-tested hardware in many new road cars and trucks today to improve engine efficiency and fuel economy including:
    • smaller and turbo-charged engines,
    • lighter-weight plastics, composites and other materials to replace heavy steel components used in exteriors and interior applications like dashboards,
    • start-stop ignitions to conserve fuel, and
    • clutchless transmissions with computerized gear shifting to minimize inefficient errors.

Many drivers are unaware that a dirty engine can negatively impact their fuel economy. In fact, if enough oil deposits form in the engine, there could be a loss of 3-6% of their fuel economy.[e]  Motor oils with special formulations can keep engines clean throughout their lifespan. For example, Pennzoil Platinum® Full Synthetic Motor Oil is formulated with Superior[f] Active Cleansing Agents that allow motorists to drive an extra 550 miles per year on average compared to a dirty engine. The quality of fuel and fuel additives also play a role in optimizing engine economy.

  • Performance: Despite the drive for efficiency and lower emissions, many U.S. consumers want performance from their vehicles and use their purchasing power to influence automakers on vehicle production. Some technology, like turbochargers, helps boost engine performance and fuel efficiency. New hardware can also have an unintended impact on other parts of a vehicle. That why Shell tests and evaluates the fuel, engine oils, gear oils, coolants, transmission fluids and greases it supplies the market. For example,
    • turbos run hotter which can affect lighter weight components, so Shell engineers adjust Pennzoil formulations to better adapt to temperature variations,
    • alternative fuels may cause contaminants in engine oils, so Shell scientists design oils with better seal compatibility; and
    • start-stop motors can allow oil to 'bake' in hot spots, so Shell provides superior oxidation protection in some oils.  

For those looking for more performance on the track or road, Shell V-Power® Premium Gasoline actively cleans for better performance by removing an average of 60% of performance-robbing gunk on intake valves left behind by low quality premium gasoline.

  • Innovation: Almost every day, a new mobility invention surfaces in the market: self-driving vehicles, vehicle-to-vehicle connectivity and personal transport concept vehicles are just a few in various development stages. Shell innovates with others to keep the world moving.

For example, when the IZOD IndyCar Series changed its chassis and moved to a twin-turbocharged V6 engine for its ethanol-burning race car last year, it drew Chevrolet back to the series. The automaker wanted to test smaller, turbo-powered engines for fuel economy in road cars. Shell engineers worked closely with IndyCar and Chevy's engine builders to test motor oils in the new engines and meet all the requirements.

"To optimize our IndyCar engine performance, we desired an oil comparable with those we used for racing in the past, but they were specialty oils custom blended for racing that used only some components of oils off the shelf," said Chris Berube, Chevrolet Program Manager, IZOD IndyCar Series. "Shell Lubricants understood the IndyCar 'off the shelf' requirement and their scientists produced an innovative formulation that we tested which could be a 100% off-the-shelf, store-bought oil.  Shell provided us with Pennzoil Ultra, the brand's most technically advanced synthetic motor oil, based on the criteria for the loads, temperatures, pressures and other areas of concern. We've used it ever since."

Today, all Chevrolet twin-turbocharged V6 engines competing in the IZOD IndyCar Series use Pennzoil Ultra Full Synthetic motor oil.

"It's a testament to the quality of Pennzoil Ultra," added Berube, "that motorists can use the exact same oil in their personal cars to run errands that was in Tony Kanaan's car to win the Indianapolis 500 this year."

About Shell and Pennzoil

Shell is a global group of energy and petrochemical companies with 90,000 employees in more than 80 countries. In the U.S., Shell operates in 50 states and employs more than 20,000 people using technology and innovation to help tackle the challenges of the new energy future. The Shell downstream organization manages a portfolio of top-quality brands, including the No. 1 selling gasoline and premium gasoline brand[i] and Pennzoil®, the most trusted motor oil brand in America [ii].  The knowledge Shell gains through motorsports and other alliances help address tomorrow's mobility challenges with efficient solutions that power and protect motorists around the globe.  For details, visit www.shell.us/smarterdriving, www.shell.us/racing or www.pennzoil.com.

i Source: NPD Motor Fuels Index December 2005 – 2011.
ii Based on a survey of licensed drivers conducted by a leading research firm January 2005December 2011.

Sources:


a.

J.D. Power and LMC Automotive release on August 2013 sales.

b.

Automotive News Data Center. August 2013 light-duty vehicle sales up 17% vs. 2012. Overall sales reported at a Seasonally Adjusted Annual Rate of 16.1 million

c.

Polk, Global Light Vehicle Overview, August 2013.

d.

Kline study, 2012.

e.

Fuel economy measurements made using CAFE cycle under FTP75. Average of 550 extra miles based on mixed city/highway miles and US average of 13,476 miles driven per year with 4.1% better MPG vs. dirty engine. Source: fhwa.dot.gov, 2011. Follow OEM recommended oil drain intervals.

f.

Superior versus Pennzoil conventional and synthetic blend oils.

Cautionary Note

The companies in which Royal Dutch Shell plc directly and indirectly owns investments are separate entities. In this press release "Shell", "Shell group" and "Royal Dutch Shell" are sometimes used for convenience where references are made to Royal Dutch Shell plc and its subsidiaries in general. Likewise, the words "we", "us" and "our" are also used to refer to subsidiaries in general or to those who work for them. These expressions are also used where no useful purpose is served by identifying the particular company or companies. ''Subsidiaries'', "Shell subsidiaries" and "Shell companies" as used in this press release refer to companies in which Royal Dutch Shell either directly or indirectly has control, by having either a majority of the voting rights or the right to exercise a controlling influence. The companies in which Shell has significant influence but not control are referred to as "associated companies" or "associates" and companies in which Shell has joint control are referred to as "jointly controlled entities". In this press release, associates and jointly controlled entities are also referred to as "equity-accounted investments". The term "Shell interest" is used for convenience to indicate the direct and/or indirect (for example, through our 24% shareholding in Woodside Petroleum Ltd.) ownership interest held by Shell in a venture, partnership or company, after exclusion of all third-party interest.

This press release contains forward-looking statements concerning the financial condition, results of operations and businesses of Royal Dutch Shell. All statements other than statements of historical fact are, or may be deemed to be, forward-looking statements. Forward-looking statements are statements of future expectations that are based on management's current expectations and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in these statements. Forward-looking statements include, among other things, statements concerning the potential exposure of Royal Dutch Shell to market risks and statements expressing management's expectations, beliefs, estimates, forecasts, projections and assumptions. These forward-looking statements are identified by their use of terms and phrases such as ''anticipate'', ''believe'', ''could'', ''estimate'', ''expect'', ''intend'', ''may'', ''plan'', ''objectives'', ''outlook'', ''probably'', ''project'', ''will'', ''seek'', ''target'', ''risks'', ''goals'', ''should'' and similar terms and phrases. There are a number of factors that could affect the future operations of Royal Dutch Shell and could cause those results to differ materially from those expressed in the forward-looking statements included in this press release, including (without limitation): (a) price fluctuations in crude oil and natural gas; (b) changes in demand for the Shell's products; (c) currency fluctuations; (d) drilling and production results; (e) reserve estimates; (f) loss of market share and industry competition; (g) environmental and physical risks; (h) risks associated with the identification of suitable potential acquisition properties and targets, and successful negotiation and completion of such transactions; (i) the risk of doing business in developing countries and countries subject to international sanctions; (j) legislative, fiscal and regulatory developments including regulatory measures addressing climate change; (k) economic and financial market conditions in various countries and regions; (l) political risks, including the risks of expropriation and renegotiation of the terms of contracts with governmental entities, delays or advancements in the approval of projects and delays in the reimbursement for shared costs; and (m) changes in trading conditions. All forward-looking statements contained in this press release are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. Readers should not place undue reliance on forward-looking statements. Additional factors that may affect future results are contained in Royal Dutch Shell's 20-F for the year ended December 31, 2010 (available at www.shell.com/investor and www.sec.gov ). These factors also should be considered by the reader.  Each forward-looking statement speaks only as of the date of this press release, August 19 , 2013. Neither Royal Dutch Shell nor any of its subsidiaries undertake any obligation to publicly update or revise any forward-looking statement as a result of new information, future events or other information. In light of these risks, results could differ materially from those stated, implied or inferred from the forward-looking statements contained in this press release. There can be no assurance that dividend payments will match or exceed those set out in this press release in the future, or that they will be made at all.

The United States Securities and Exchange Commission (SEC) permits oil and gas companies, in their filings with the SEC, to disclose only proved reserves that a company has demonstrated by actual production or conclusive formation tests to be economically and legally producible under existing economic and operating conditions.  We may have used certain terms in this press release that SEC's guidelines strictly prohibit us from including in filings with the SEC.  U.S. Investors are urged to consider closely the disclosure in our Form 20-F, File No 1-32575, available on the SEC website www.sec.gov. You can also obtain these forms from the SEC by calling 1-800-SEC-0330.

SOURCE Shell Oil Company



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