The garage might be where most people expect to encounter the company’s products—if they do at all—but it’s the bathroom where Lubrizol has made perhaps the most inroads in recent years.
When the company wants to impress visitors (or reporters) these days, it doesn’t give them a bag with samples of automotive additives and lubricants. Instead, it hands out samples of fancy cleansers, body washes, and other health and beauty products.
Liebert said those products represent not only the sale of materials but, like with other products, the sale of a lot of research, development and engineering.
The company sells to big health and beauty brands around the world, and sometimes it even formulates their products, Liebert said.
“We have beauty-research centers where we bring in consumers and test products … what kind of wrinkle reduction did they have?” Liebert said. “We give (corporate customers) the results back and they can use our formulation, or modify it for what they might want.”
Some companies tweak the formulas with some of their own ingredients to get specific added results of a certain feel or scent, but some are happy with Lubrizol’s formulas and use them as is, she said.
“Some companies today are really just brands,” Liebert said—meaning, they often turn to outside help for formulas and other aspects of product development and manufacturing.
At the same time, the company is also finding and exploiting opportunities its finding in some national and global trends, such as increased investment in infrastructure and the development of more and bigger computer data centers, Liebert said.
On the infrastructure front, in addition to serving markets such as the U.S. and Europe, Lubrizol is finding significant opportunities in China and India, the world’s two largest nations in terms of population and places where infrastructure is being improved rapidly and on a large scale.
In India, for example, Lubrizol makes chlorinated polyvinyl chloride that’s used to make pipe. Similar to the PVC pipe found in most buildings in the U.S., the chlorinated version is better for places that might have poor water quality.
“That one extra chlorine molecule makes the pipe much more resistant to more acidic or harsh water and chemicals. It makes it more resistant to temperature so it can be used at higher temperatures,” Liebert said. “CVPC pipe is the preferred pipe in India.”
Lubrizol makes it in India, for India. That’s always been the company’s philosophy, Liebert said.
“A lot of U.S. companies went to China to make products to ship back to the U.S. to sell. that’s never been Lubrizol’s approach to foreign markets,” she said. “We make, and sell, locally.”
That said, Lubrizol began investing in India and China in the 1960s, and the connections it made over decades continue to help it in those countries today. Liebert predicts she’ll be making more investments in India, and elsewhere.
“Also, southeast Asia,” she said. “It doesn’t have quite the number of people. But the growth opportunity in Indonesia, Thailand, Viet Nam and Malaysia is quite large and we’re excited about that market, too. … If we need to build, we’ll build. If we have an opportunity to partner or buy, we’ll do that.”
Here at home, the company is eyeing another nascent market it thinks will grow rapidly—serving the growing industry of artificial intelligence, crypto mines and data centers running large numbers of servers.
Lubrizol has developed a dielectric fluid into which servers can be immersed, and then run at much cooler temperatures than they could be run in an air-cooled environment, without the need for noisy and power-hungry cooling fans.
“It’s much more effective than an air-cooled system, because air is a very poor conductor,” Liebert said. “Were not selling it at scale yet – but we’re ready to sell it at scale now.”
The company even makes advanced medical devices, most of which are based on its specialized polymer technologies.
“We manufacture medical devices that are used in some of the most advanced procedures in the world today. We have catheters doctors use to perform surgery in the brain, and in the eyes,” Liebert said.
The advances have helped the company grow significantly. Privately held by Berkshire Hathaway, Lubrizol doesn’t release its earnings or garner analyst coverage these days. But inside Berkshire’s annual report you can find that the company had revenues of $6.4 billion in 2023. That was down slightly from $6.7 billion in 2022, but Berkshire attributed the decline to currency valuation changes, not poor performance.
What’s likely more important to a long-term investor like Berkshire is Lubrizol’s long-term growth. The company’s revenues were under $3.9 billion a year in 2010, the year before Berkshire bought the company.
Liebert said much of the company’s growth and many of its new technologies stem from its 2004 acquisition of Noveon for $1.8 billion. That company’s strength in polymers meant the acquisition came with a lot of valuable intellectual property that Lubrizol relies on today, Liebert said.
She doesn’t rule out buying another such company, if she can find one. “Yeah, for sure,” Liebert said. “We’re always open for more opportunities in the market place.”
A deal that would bring even more technologies would be great. But with or without it, Liebert said her company needs to keep innovating its core chemistry, which Liebert said is really all about surface chemistry. There are more and more products coming in the years ahead it would like to be part of, she said.
“We’re going to have flying cars at some point. We’re going to have trips to Mars at some point,” she said. “And whether it’s flying cars or trips to Mars we need chemistry that is going to bring us better surfaces to let those things happen.”
