SocraticGadfly: Gas prices literally spin out of control for small-town stations

May 13, 2008

Gas prices literally spin out of control for small-town stations

Old rotary-dial gas pumps can’t go over $3.99, so what’s a mom-and-pop type independent station in rural Texas to do?

Yes, there’s still pumps like this around, especially in more sparsely populated rural areas well off the beaten track. I’ve seen them in places in West Texas.

And, no, this isn’t a totally isolated problem. It’s estimated about 5 percent of the nation’s 170,000 gas stations have this problem. Also, many of them can’t record a total sale over $99.99. For a big-tank pickup or SUV, let alone an RV, a $100 fill-up is the norm now.
At Chip Colville’s Chevron station in this eastern Washington town, where men in the family have pumped gas since 1919, three stubby, gray pumps were installed when gas was less than $1 a gallon. They top out at $3.999, only 30 cents above the price of regular gas at Colville's station.

“In small towns, where you don't have the volume, there’s no way you can afford to pay for the replacements for these old pumps," Colville said. “It’s just not economically feasible.”

The problem is worse in extremely rural areas, where “this might be the only pump in town that people can access,” said Mike Rud, director of the North Dakota Petroleum Marketers Association.

And, a new pump ain’t cheap — try $10,000-$15,000. And, if you can afford it, you’re going to be waiting months to get it.

There are less expensive options, for at least the per-gallon price. A kit will let the maximum price be upgraded to $4.99, for about $650. And, as fewer and fewer of these beasties continue to survive, there’s fewer and fewer people to service them.

North Dakota, where much of the state is sparsely populated, is allowing gas station owners to bill by the half-gallon, as long as they inform customers the actual price will be double what the pump says.

That will also help — for now — pumps that won’t go over $99.99, as they can now, in effect, hit $199.98.

But, it may not be worth it:
“If gas is the profit driver and you are one of those guys with the old pumps, you're either evolving or getting out,” said Jeff Lenard, spokesman for the National Association of Convenience Stores, a trade group that represents about 115,000 stores that sell gasoline.

“If you’re just that kind of image of the ’50s gas station where you have a conversation, fill up and have a cup of coffee, that's in the movies.”

Well, Mr. Lenard, a few people in rural places may have that nostalgic love still, just like the farmers in North Dakota or ranchers in west Texas that visit such pumps.

But, as more and more people move off those farms and ranches, they have less need for those stations.

Speaking of that, I wonder how many farmers and ranchers are cheating on blue diesel use. C’mon, you know it’s happening.

No comments: