Comments on: Price Gouging?

By: Bryan

Bryan — Sat, 29 Apr 2006 04:30:06 +0000

Self-serve is a problem for older people down here, especially during the summer, but they didn’t support the people who tried to continue the tradition.

By: Michael

Michael — Sat, 29 Apr 2006 02:18:11 +0000

Apparently, at least according to NPR this morning, both New Jersey and Oregon prohibit self-serve gas stations. New Jersey’s Democratic governor is considering lifting the ban on a trial basis along the Jersey Turnpike, to see if it helps ease the sticker shock a little. If the fuel prices drop, he’ll consider revoking the ban altogether, or at least trying to get the Assembly to do it for him.

By: Bryan

Bryan — Fri, 28 Apr 2006 17:39:23 +0000

A full-service gas station! That’s pretty amazing. I have to watch my Mother’s gas gauge and and take it to a gas station for her, because we don’t have any down here.

The morning check thing must be what’s going on down here, because I know when my local station gets its fuel delivery, so the price shouldn’t change during the week, but it does.

It isn’t legally price-fixing unless they have some type of formal agreement at an upper level, although what you describe is the equivalent as far as I’m concerned.

By: Michael

Michael — Fri, 28 Apr 2006 17:16:18 +0000

Most are franchisees of the big boys, but we do still have a few indies. And there’s one Shell station in town that still has a garage, does auto service, and will pump gas for customers that want that service. (Also virtually the only place in town I know of where the air pump is still free.) Except for that station, I think every place that sells gas in our little metro area has at least a small convenience store, though I almost never shop there for anything except maybe a bottle of water if I’m starting out on a long trip, and even that I’m more likely to grab on one of my regular shopping trips and just bring along. But apparently one of the managers’ jobs each morning is to drive by their competitors’ places and take down the prices they’re displaying. When they get to their shop, they phone or e-mail those in to a central clearinghouse, and they’re then told what their offering price for that day is supposed to be. That sounds an awful lot like price-fixing to me.

By: Bryan

Bryan — Fri, 28 Apr 2006 16:12:38 +0000

You must still have truly independent retailers up there, Michael. Down here they get run out of business quickly. There are a half dozen convenience store with gas chains, and then Exxon and Shell have gas stations with convenience stores. There aren’t any gas stations with auto repair left, and the pure gas stations have been gone for years.

This happened when the fuel tanks had to be upgraded to the new, anti-leak variety. Essentially the little guys couldn’t afford to install the new tanks and went under.

There were a couple of gas stations nailed for gouging after Katrina, but the also got nailed by their corporate owners when the state was finished, because the money was being kept by the local operator – a result of the computer monitors being off-line due to power outages.

By: Michael

Michael — Fri, 28 Apr 2006 14:27:19 +0000

While on the whole your analysis is sound, Bryan, there have been proven cases of price gouging in Illinois (where our attorney general launched a probe after the post-Katrina spikes last year). It would not surprise me in the least to learn that similar tricks were being pulled now, or elsewhere across this country.

However, I also think it’s difficult to say that gasoline retailers do not engage in practices that would get other companies busted for fraud. Virtually without exception, retailers charge exactly the same price for their product. If one of them raises the price, it’s usually less than a day later that they all have–and to exactly the same level.