Expert says cheap, locally owned East Kimberley diesel may be hard to replicate more broadly
By Sourced Externally
March 22, 2022
A West Australian motoring body says a situation in the remote Kimberley, where a local company is selling diesel at prices significantly lower than in other parts of the country, may be difficult to replicate more broadly.
CGL says it has low overheads and imports in bulk from Singapore
The company’s chief executive says CGL can operate on tighter margins than some competitors
A motoring expert says the company’s model is unusual and wouldn’t be feasible for most businesses
On the weekend some motorists in far north WA could buy diesel for $1.99 cents a litre from Cambridge Gulf Limited (CGL).
The price charged at its outlets in Kununurra and Wyndham was 20 to 30 cents cheaper than in Sydney, Melbourne, Perth, Darwin and elsewhere in the region.
Diesel is a vital commodity in far north WA, where trucks service vast cattle stations and many people own four-wheel drives.
CGL imports diesel from Singapore into Wyndham and the price for a monthly shipment of up to five million litres guides what is offered at the bowser.
If supplies run low, CGL trucks supplementary fuel in from Darwin, which can influence the retail price.
Chief executive Tony Chafer said he could only guess as to how the company could significantly undercut major retailers.
“We don’t have to make a particularly large margin,” he said.
“We’re a fairly small business — we don’t have massive overheads.
“We’re very keen to make sure in these particularly hard times, with the rising cost of living, that we can do whatever we can to pass on some savings to our community.”