Woolies Does Petrol Deal With Caltex Now

[Falchoon]

http://www.smh.com.au/articles/2003/08/21/...1434986613.html

Woolworths has trumped rival Coles Myer in the battle for the retail petrol dollar, announcing a joint venture with oil refiner Caltex that could add 160 sites to its discount petrol business.

The deal, announced after the market closed yesterday, was initially welcomed by analysts, who said Woolworths appeared to have kept its costs down while significantly extending its petrol offer.

The move comes almost three months after Coles clinched a discount fuel offer with petrol retailer and refiner Shell Australia that it hopes will close the gap between it and Woolworths.

Coles began developing 150 co-branded service stations in Victoria in July and expects to have 584 sites across Australia by the middle of next year.

Woolworths' chief executive Roger Corbett said yesterday the joint venture with Caltex would start operations before Christmas.

"This venture means we get the right number of canopies in carefully selected locations adjacent or near to our stores across Australia supplying Caltex petrol, extending our excellent petrol offer to more Woolworths and Caltex customers and without having to take on canopies we don't need," Mr Corbett said.

The joint venture company will lease all of Woolworths' and Safeway's petrol outlets, initially adding 120 Caltex service stations to Woolworths' national network of 290 petrol sites. Another 40 sites may be added to the network later.

Both Woolworths and Coles offer petrol discounts to shoppers who spend above a certain limit at their supermarkets.

Analysts say petrol retailing is becoming just another cost of business for big grocers, that makes no money in its own right but boosts supermarket sales.

Macquarie Equities analyst Ron Sargeant, however, said Woolworths' choice of sites should ensure it maintains a low cost network.

"Woolworths would have been in a generally stronger bargaining position with Caltex than Coles was with Shell," he said. "Hence, you might expect a more favourable sourcing agreement."

Woolworths has sold petrol since 1996. Coles began because it was losing an estimated 2 percentage points of supermarket revenue growth a year.

A spokesman for Coles said Woolworths' deal with Caltex proved Coles's Shell alliance had changed the shape of the market.

[richdave]

Kool, does that mean I can use a shop a docket to get a discount AND put it on the fleet card?

[Mondie]

l read in the Age that Woolies do use upto 95% imported fuel from Asia, so its a good move by them to try and raise the quality of what they supply.

Coles got the golden goose in teaming up with Shell though

[XR8Chic]

bah - when are they going to have a deal with someone who sells REAL fuel?

Caltex/Ampol fuel is crap. Shell isnt much better. But maybe I guess you can use the money you save, to pay for the repair bills on your car when they die.

[Mondie]

In the Shell servo today and the manager there reckoned that IGA are currently negotiating a tie up with BP! No hope for the independants if that happens. People may be getting a discount on their fuel now, but once all the independents are squeezed out, we are all going to be paying more. :(

She also said there average takings have DOUBLED since the Coles discount started.

[Lumpen]

Nobody blames deregulation of the Oil Industry for stupidly massive prices hikes....

[Turbo6man]

l read in the Age that Woolies do use upto 95% imported fuel from Asia, so its a good move by them to try and raise the quality of what they supply.

Coles got the golden goose in teaming up with Shell though

Yep, I believe everything I read in The Age too ... NOT !!

Woolies currently buy mainly from Mobil ..... this has been posted on several forums by a contact within Mobil.

I guess it's possible Mobil are sourcing 95% of their fuel from Asia.

Anyway, Asian fuel is probably as good if not better than our own home grown crap ... we reportedly have amongst the lowest quality fuel in the world.