Gull effect takes hold in New Plymouth as new station opens

Friday, 27 January 2017

Gull's fourth customer in New Plymouth ran his car 56 kilometres on empty just to fill up as much as he could at the new station on its opening day.

'I knew it was coming so I've been hanging out for it to open,' Wayne Parker said.

BP Powderham owner Bob McLean said they would have to adjust prices to remain competitive.

Gull's much-anticipated unmanned station on Courtenay St was already undercutting the local competition, with prices about 15 cents cheaper on both petrol and diesel compared to nearby petrol retailers.

Mobil, Z Petrol, New World, Caltex and BP in the city centre were all advertising 91 at $2.089 and diesel at $1.359, while Gull opened with $1.93 and $1.19 with more cuts to come, project manager for the new station Belinda Milne said.

* Gull set to open two new service stations in Taranaki

* New Plymouth's 'Gull effect' set to hit as station prepares to open

* Fuel prices predicted to tumble as Gull alights in Taranaki

* New Plymouth's 'Gull effect' set to hit as station prepares to open**

'We're just going to watch how long it takes for the other stations to follow suit and adjust their prices,' Milne said pointing at the Caltex and Mobil price boards visible just down the road.

'We expect it to happen and we're surprised they hadn't dropped their prices before we opened.'

It didn't take the competition long.

As of 2pm on Friday the Gull effect was in full swing with Caltex, BP Powderham, and Z Petrol rolling back their 91 price to $1.999 while Mobil went a step closer to Gull to $1.979.

Wherever Gull opens, motorists quickly see cheaper prices at other stations, a phenomenon dubbed the 'Gull effect'.

Diesel prices were more variable in the afternoon with Z coming closest to Gull with $1.199, followed by Mobil on $1.239 and then Caltex and BP on $1.259.

Petrol prices get steadily cheaper the further out of New Plymouth the stores are located, with Stratford Z clocking in as the closest to Gull's prices, with $1.939 for 91 and $1.179 for diesel.

GAS in Hawera was the next cheapest - of the stations willing to reveal their fuel prices over the phone - with $1.96 and $1.17 for petrol and diesel respectively.

Phil Gayton mapped out petrol prices between New Plymouth and Levin when he traveled there on January 20.

Z Petrol on Courtenay St on par with other petrol retailers in the area.

New Plymouth resident Phil Gayton recently recorded the prices of fuel from a range of suppliers as he travelled to Levin from Taranaki on January 20 and found Gull in Levin to be the cheapest at $1.797 for 91 and $1.097 for diesel.

Milne said they would 'be having some fun with the pricing' over the next few weeks, including once-a-month discounts.

'For example before Christmas we went 20 cents below the usual price, but standard discounts are usually about 10 cents,' she said.

While Gull stations are usually unmanned - that's how they attribute their costs to being so low - the new station will have attendants on hand for six weeks to teach customers how to use the self-service pumps.

Neil Marshall was also hanging out for the new Gull to open and had - like Parker - waited until his tank was on empty before rolling through.

'I'll be coming here from now on, it's on way through so may as well grab the cheaper stuff,' he said.

'We're getting pretty ripped off here so it will be good to everyone else drop their prices to match.'

British Petroleum at Moturoa and Powderham owner, Bob McLean, said he would have to adjust his prices to remain competitive.

'We won't always be able to match their pricing but we'll do our best,' he said.

'They're very different businesses though, we have a different operation in terms of providing a whole package with covered pumps and a store where people can get coffee.'

McLean said they knew the station was coming, so it wasn't out of left field, but Gull's point of difference could only be in pricing, rather than the other facilities BP offers.

Z Petroleum's corporate communications manager, Jonathan Hill, said the company couldn't - and wouldn't - signal any price changes in advance.

'What I would say is that we currently have a 10 cent per litre national discount off pump prices in place today and tomorrow at all of our 200 plus retail service stations nationwide which provides further customer value,' he said.

'Generally speaking there's a lot of regional discounting on the go regarding petrol prices – there has never been more competition or choice for consumers, which is a good thing.'