Undercutting petrol station NPD expanding across Canterbury

Friday, 22 December 2017

The NPD self-serve on Haswell Junction Rd is undercutting everyone else at $2.029.

A home-grown petrol brand could be threatening the petrol industry in Christchurch – but it is a mystery how it undercuts its competitors.

Petrol stations across Christchurch had identical prices for fuel last week – $2.109 a litre for 91 and $1.449 a litre for diesel. The four main competitors – BP, Z, Mobil and Challenge – appeared to copy each other's prices.

Challenge on Hills Rd - just like everywhere else - charged $2.109 for 91 and $1.449 for diesel in the week before Christmas.

There was an exception in Hornby. On Wednesday, the Mobil on Main South Rd offered 91 for $2.069 and diesel for $1.389. The BP on Main South Rd charged the same as everywhere else for 91, but offered a discount on diesel at $1.389, the same as its competitor across the road.

The new kid in town (relatively speaking) it is undercutting its much larger competitors, offering $2.029 for 91.

Challenge in Christchurch - just like everyone else, $2.109 for 91, $1.449 for diesel.

Fuel prices in Christchurch are sitting at $2.109 for 91 at most pumps.

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NPD is a Nelson-based brand established by the Milne family in 1961. The NPD brand has expanded steadily, growing from 30 to 40 sites across the South Island between 2013 and 2016.

The Z on Moorehouse Ave - $2.109 for 91, $1.449 for diesel.

There was only one NPD in Christchurch, on Halswell Junction Rd on the southern outskirts of the city, until NPD built a branch on the corner of Lincoln Rd and Moorhouse Ave this year.

The company is now building another station on Port Hills Rd in the city's south-west and another branch is expected to open in Kaikōura in 2018.

The BP on Main South Road has the same price for 91 as everywhere else but slightly cheaper diesel. The Hornby Mobil in the distance is an exception to the rule.

Fuel prices in Christchurch are sitting at $2.109 for 91 at most pumps - the Caltex on Riccarton Road

Some of the 'stations' are just truck-stops; they have no shops and no attendants. But this has become a hallmark of some NPD stations in the South Island.

NPD has its own fuel card, which had more than 4000 users last year. It is available to general 'mum and dad' customers and gives discounts of 10 to 15 cents per litre for SuperGold card holders.

NPD is keeping its strategy close to its chest. It is unclear how the company is managing to undercut everyone else without disrupting its own profit margins – the company has not responded to requests for information. NPD declined to explain its plans when Stuff requested the information in 2016 as well.

Stuff asked all of NPD's big competitors why their prices were almost identical to each other.

South Island Challenge territory manager Glen Colvin said it was up to each station to set its price.

'All Challenge stations are independently owned and operated. They set their own price and this will be based on competitors in their local market.'

BP's corporate and external affairs manager, Leigh Taylor, said BP was not pricing according to its competitors.

'I can't comment on what our competitors are doing or what their operations look like, but can confirm that BP independently sets its own prices based on a variety of different factors including cost of product, exchange rates, taxes and operating costs.

'We do our best to ensure our prices are competitive, and pricing in localised areas really comes down to local market forces.'

Mobil and Z did not respond to Stuff's questions.

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