VACC And ACCC Butt Heads On Petrol Discounts Photo:
Mike Stevens | Jul, 16 2009 | 3 Comments

ACCC CHAIRMAN Graeme Samuel has missed the point in the matter of the recent price war between Coles and Woolworths, according to the Victorian Automobile Chamber of Commerce (VACC).

Coles and Woolworths/Safeway this week announced huge petrol discounts of up to 40 cents a litre for customers spending between $100 and $300 in stores - a move that has been criticised by a number of peak consumer and automotive business groups across Australia.

At issue is that if these giant grocery chains can discount to such a level, they are price-gouging somewhere - either on the groceries, or on petrol.

VACC Executive Director, David Purchase, said that the ACCC Chairman's suggestion that independent petrol stations move to match the discounts on offer by the giant retailers is an "impossible" position that would put them out of business.

?Big supermarkets running big fuel outlets can discount heavily because they have the wherewithal to do so. But small independent service station and convenience store owners simply cannot," Mr Purchase said.

?They do not stock the thousands of grocery items to subsidise a 40 cpL discount. Most small independent service station owners are only surviving by the skin of their teeth and this discount price war has the potential to tip many over the edge.

?Contrary to Mr Samuel?s comments, it is impossible for small independent fuel retailers to ?match? this level of discounting and remain in business," he said.

Mr Purchase said that rather than focusing on supermarkets and their competitors in the grocery sector, consumers would be better served if the ACCC investigated the motives behind the massive discounts being offered by Coles and Woolworths/Safeway.

?Could it be because there will be a pay-off in the future once competitors and small independent service station owners have been eliminated??

?While Mr Samuel says ?the ACCC?s responsibility is towards 21 million Australians?, those very people the ACCC is trying to protect may ultimately lose out when there is little, if any, real competition,? Mr Purchase said.

Motorists might reasonably be disappointed that the ACCC has been all-but ineffectual in untangling petrol retailing practices in this country, and continues to preside over what it has itself described as a "comfortable duopoly".

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