Economics of a gas station

[mecklen]

I'm very curious about the economics of running a gas station. I've heard that retailers make a vanishingly small profit from gasoline, like 1/2 cent per gallon, and that many go out of business. I've also heard that they aren't passing along the full rise in gasoline costs to the consumer. If this is true, it clearly exacerbates the situation.

It seems to me that if there were a national push to improve CNG fueling infrastructure, it would tend to occur by adding the capability to existing stations. After all, they have the land and are already in the fueling business. But that leads to the question of how they would pay for it. It seems that the hated CE stations are the first wave of this possible expansion. (Are CE stations dedicated to CNG?)

[CraziFuzzy]

Re: Economics of a gas station

CE really hasn't built many stations... they basically come in and take over operation of an existing public or private station, cut a deal to the previous owner/operator to still sell them their gas for cheap, and sell to the public at a sick profit. As for adding CNG to a gas station, I'm thinking a LOT of gas stations would not have the real estate for it. The gasoline/diesel tanks are underground, and share space with the parking/fueling area. A CNG compressor/storage system takes up space most gas staions don't really have.

I would like to see a CNG station with a minimart though... and a squeegee would be nice from time to time as well...

[jetboatjohnny]

Re: Economics of a gas station

Diamond Bar station has squeegees, and oh yeah there's the AM-PM in GG I avoid.

[freedml]

Re: Economics of a gas station

Very few CNG dispensers are colocated with gasoline pumps. Person Ford in San Diego has one of each (cng, biodiesel, lpg) and the normal gasoline pumps. There was one at a Shell station in downtown LA that closed at least 5 years ago. And one at a Chevron station in Agoura Hills that they abandoned about 3 years ago.

CE takes over and maintains existing stations when they see an opportunity (SCGas, LBGas), but their primary business is getting municipalities to use CNG for their trash trucks and buses. They sell them the refueling infrastructure and often throw in a Public Access setup in the bargain. This would include at least Burbank, Pasadena, LAUSD (Chinatown) and Santa Clarita stations. I don't know the OC or IE stations very well. Rumor is that they will be refitting UCLA soon.

[cngmike]

Re: Economics of a gas station

"CE takes over and maintains existing stations when they see an opportunity (SCGas, LBGas), but their primary business is getting municipalities to use CNG for their trash trucks and buses. They sell them the refueling infrastructure and often throw in a Public Access setup in the bargain. This would include at least Burbank, Pasadena, LAUSD (Chinatown) and Santa Clarita stations. I don't know the OC or IE stations very well. Rumor is that they will be refitting UCLA soon.[/QUOTE]

There is far more grant money for public stations.