Fuel price drop sign of strong competition
Filling the tank just got cheaper in Tokoroa – and the town-wide price drop came just hours after the bright lights of Gull’s unmanned station lit up for the first time.
Last Wednesday, Gull, an independent, family-owned energy company, opened its latest petrol station on the corner of Bridge St and Leith Place, to the delight of locals and their wallets.
By early afternoon the same day all three stations around town had dropped their petrol and diesel prices by more than 7 cents per litre to match.
BP communications manager Jonty Mills said BP had decided to match Gull’s prices ‘‘where and when we can’’.
‘‘For us it’s about providing choice for our customers. We’ve got to decide whether we chose to compete strongly on price. There are a whole lot of other reasons that people come to BP, including the shop and customer service. At the moment we have decided to compete strongly on price in that area [Tokoroa], it is not a national price for us.’’
Challenge management, who controlled Mobil and Challenge prices, said the fact that prices dropped after Gull opened was a coincidence.
‘‘We can’t say it was because of the Gull because we are an independent.’’
He said their prices were dictated by the cost price of the fuel itself, not competing stations.
But Gull believed the pricematching in Tokoroa was an example of the ‘Gull Effect’, the localised price drop trend across competitors described by the Automobile Association (AA) following Gull’s introduction into a new location.
Retail development and sustainability manager Karl Mischewski said the introduction of a Gull station prompts other local stations to drop their prices to compete.
‘‘The ‘ Gull Effect’ is our positive contribution to lower petrol prices by being a challenger and prompting our competitor’s reaction to our own cheaper pricing strategy,’’ he said.
‘‘We’ve seen it happen at other locations when Gull has entered the market and we believe Tokoroa has followed suit. Cheaper petrol has arrived and everyone in Tokoroa can benefit.’’
The new Gull site is an unmanned drive-through site that provides regular, diesel and Force 10 grades. Gull has worked in partnership with local company, Raukawa Iwi Development Limited, to develop the station during the last 12 months.
‘‘ We’ve really enjoyed working with Vanessa Eparaima and the team at Raukawa and are excited to see the fruits of our partnership come to life today.’’
Going down: Other petrol stations are matching Gull’s lower Tokoroa prices for now.