Petrol stations closing as supermarkets keep slashing prices

Independent petrol stations are struggling to keep up with the large supermarket chains who are continually cutting fuel prices.  So much so, that a massive ten petrol stations are said to be closing their doors each week, as they fail to keep up with the supermarket giants.

With chains such as Tesco, Morrisons and Sainsburys reportedly selling fuel at a loss, it’s no wonder the smaller independents are failing to keep up.

Latest statistics have shown that in the last ten years, a whopping 5,250 garages have closed, resulting in the loss of thousands of jobs.

Rural, out of town areas are being hit the worse, with some motorists having to drive a 16 mile round trip just to fill up their cars.  Experts are predicting that the larger towns and cites will also start to see the effect as closures become more and more widespread.

And it’s not just the smaller garages suffering, some of the bigger brands are also feeling the threat, with Jet announcing recently that they would be closing all stations in the South West by the end of 2011.

While supermarkets maintain they are simply giving customers ‘choice and value for money’, watchdogs disagree, and are calling for an investigation into the ‘unfair pricing system’.

Many claim that supermarkets are subsidising lower petrol prices with extensive profits from stores, but Morrison’s have denied these claims saying “Our ­priority is to give the best possible deal to customers. We never make a loss on our petrol”.

It is thought that 40% of the fuel market is now controlled by the supermarket giants.  John Franklin from the RAC has spoken out saying “The closure of so many ­independent garages is a serious concern, ­especially for those who live in rural communities”.

This article was brought to you by Think Insurance, specialists in motor trade insurance.

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