Karen Collier, 28 October 2015
COSTCO has thrown down the discount fuel gauntlet, opening its first Victorian petrol station and confirming plans to roll out more.
The US warehouse giant is also set to expand into mobile phones and blind and curtain home installations.
Even coffins will be sold from early next year.
CommSec’s Savanth Sebastian said Costo “has the potential to change the fuel landscape over the next few years”.
Drivers using the self-serve bowsers at Moorabbin Airport yesterday afternoon were saving up to 15.2c a litre on diesel and up to 5.2c a litre on unleaded compared with nearby rivals.
With a Coles shopper docket, the gap narrowed to as little as 1.2c a litre for unleaded.
The fuel foray comes as analysts predict unleaded petrol could drop to as low as $1 a litre before Christmas due to a global oil oversupply.
Costco’s unleaded and diesel was yesterday 109.7c a litre. Premium was 124.7c a litre.
Motorists using the card-operated pumps must be members of Costco, which has a $60 annual fee.
Costco country manager Patrick Noone said surrounding competitor prices would be regularly checked to ensure members got the best deal.
“We have a lower mark-up and always try to be the best price,” Mr Noone said.
“Prices will be checked several times a day.”
The fuel outlet is Costo’s fifth in Australia. Another will open at Epping within two years.
Other potential sites in Melbourne’s southeastern and western corridors are being eyed off.
Costco’s adjoining Moorabbin warehouse opens on November 18.
The petrol station operates 6am-9.30pm weekdays, 6am-7.30pm Saturday and 7am-7pm Sunday.
Gail Robson, of Dingley Village, said her husband was likely to benefit as he had a truck for his business.
“He will probably come here a lot if they keep the diesel price cheap,” Mrs Robson said.
Mr Sebastian said extra competition would pressure nearby operators to try to keep a lid on costs. As Costco continued to expand, Coles and Woolworths in particular could become more aggressive.
Mr Noone said rivals eased prices 2-3c a litre ahead of the first day of fuel trade at Moorabbin.
Costco’s fuel outlets interstate have prompted price wars after first opening. But the fierceness of competition has tended to taper over time.
All future Costcos built in Australia are expected to have an accompanying petrol station.
Extracted in full from the Herald Sun.