Friday, June 3, 2016

IT TOOK A WHILE, NOW IT IS REALLY WORKING EH.

When monopolies are over come it can sometimes take a while to alter the mindset they have been working under.

Fuel prices are an object lesson.

Mobil, Caltex, Shell and BP dominated our fuel distribution and pricing that always had the appearance of collusion.

A couple of years ago a mate in a tourist town a hundred kms from a port city had his supply contract with Shell cancelled after Z was created to assume the brand, in a rationalisation based on annual turnover. Tanks removed and things seemed bleak with the alternative being  a couple of Allied pumps on the main road in, at prices well in excess of big four pricing.
A minor player, Nelson based, stepped up and now that service station is delivering fuel at city prices, offering patrons with gold cards a 10c per ltr discount and all is well again particularly for the thousands of itinerants who descend during the summer months.
That wholesaler, Nelson Petroleum Distributors has since opened a selfservice option in Christchurch on Halswell Junction Rd that retails on Credit card payment, discounted Regular and Diesel at discounts up to 15 c a ltr on the other big players across the city.

Presently on tour in the off shore island, things are even more spectacular. Enroute North from the Bluebridge Ferry, another great private enterprise operator that has shown the old NZR monopoly up as the charlatans they were, to Hawkes Bay, came upon a self service fuel outlet at Foxton. "Waitomo", with diesel at 84 Cpl while most we had passed were around the dollar and more.
Now based at Rotoiti east of Rotorua, went up to Taupo yesterday for a lunch with mates from home also on tour, and very surprised to find a Mobil on the main drag there with Diesel at 74.9 cpl having passed outlets in Rotorua with diesel up to 109.9, at BP on Hwy 30 earlier in the day.

With fuel and its multiple outlets in direct competition it is so easy to see how competition is working hour by hour.
 Electricity not so open to such discovery but once protections and cartels are exposed to "the market" such evidence becomes there for all to see, but only if people are so inclined.
Those with their glass perpetually half empty wont hear a word of such facts of life.
Moi, as a current gypsy nomad, it is mana from above and gratefully accepted.


14 comments:

pdm said...

I brought 91 petrol in Taupo last Friday at $1.74 less 6c Smartcard - 8c cheaper than Hastings.

Anonymous said...

When North of Levin and Masterton I made a point of seeking out and using Gull - usually 8 - 10 cents per litre less than 'big' four. I also found Waitomo in Foxton, which was even cheaper than Gull. If you have a discount retailer in your area I recommend you use them, 'cause if they leave, you will get what we have in the Southern regions - gouging (possibly to subsidise their competing with the discounters up North).

Johno said...

For some reason the highest prices I see are in Auckland city where there are lots if gas stations. Yet you can drive through somewhere like Morrinsville and get gas 15c or more a litre cheaper than Auckland GAHHH!

Johno said...

Update: Morrinsville Mobil has 91 at $1.55 - so it's 40c cheaper then my local Z in Auckalofa.

Anonymous said...

Back from Fiji a couple of weeks ago. Pump price converted to NZD 91 octane $1.16 per litre. Lets hear it for (carbon) taxes!!

pdm said...

Missed out on $1.62 less o6c with Smartcard this morning. Went to fill up 30 mins after I saw itandprice wa back to $1.77. Bugger!!

Noel said...

Johno the reason is the jmporter margin at the port of entry been charged at the higher rate whilst those at a distance from the entry point are reduced.

Put an other way all you city dwellers are subsidising the provinces.

pdm`` said...

Noel & Johnno - As I recall Auckland has a `Road Tax' (or whatever it is called) of x cents a litre.

Noel said...

Wasn't the regional petrol tax rescinded?
Anyway at its peak it was estimated at 9.5 cents per litre. Doesn't explain a 40 cents per litre difference.

There's only a very small margin for service stations owners.

But importer margin can make up 35 percent of the price which gives a lot of wriggle room.

Makes sense to charge the highest margin at the point of entry because of less erosion by distribution cost and volume sales.

Anonymous said...

Noel, if the city dwellers are subsidising the provinces they're not doing a good enough job - passed through Wanaka this morning and got stung $1.419 /l for diesel.
It's way cheaper even in Queenstown, quite a few more ton/miles of freight further down the line.

Mick

Gerald said...

Everything's expensive at Wanaka compared to Queenstown.

gravedodger said...

Wanaka is smaller than Qtown so lower turnover.
Bluff to Qtown further than Wangarei to Auky and they are both ports. Fuel is freighted to either Bluff or Port Chalmers then nearly 300k road kms. Wanaka is further.

Then the greedies in the north don't think they should pay the freight for their electricity from the SI.

Gimme a break

Anonymous said...

Following price snapshot illustrates different pricing patterns.

Gull BP

Northland 1.749 1.779
Auckland 1.569 1.789
Waikato 1.669 1.749
Bay of Plenty 1.639 Hawkes Bay 1.779 1.699
Manawatu 1.819 1.699

Port of entry for Gull Mt Manganui Bay of Plenty.
Port of entry for BP Auckland

Adolf Fiinkensein said...

Anon@12:29

Excellent comment. Another reason to shift the Port of Auckland?