Should ‘zone pricing’ be outlawed?
L.A. Times
2013/01/02 20:57:58
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Record gasoline prices in 2012 and calls for investigation of California's fuel markets have brought into focus a persistent peculiarity of the state's service station world: the wild swings in price any brand has from one location to the next.
Known in the industry as zone pricing, the controversial practice was apparent one afternoon when Culver City resident Michael Denis, on a jaunt to downtown Los Angeles, stopped at a Chevron station to feed his Fiat 500 some gasoline at $4.69 a gallon. About four miles away, Lupe Alfaro was filling her Toyota Camry with Chevron gasoline but was paying $3.89 a gallon.
The two motorists were buying the same grade of gasoline, which more than likely came from the same refinery in El Segundo. Yet the prices they paid differed by 80 cents a gallon, or by more than $10 to fill an average 13-gallon tank.
Known in the industry as zone pricing, the controversial practice was apparent one afternoon when Culver City resident Michael Denis, on a jaunt to downtown Los Angeles, stopped at a Chevron station to feed his Fiat 500 some gasoline at $4.69 a gallon. About four miles away, Lupe Alfaro was filling her Toyota Camry with Chevron gasoline but was paying $3.89 a gallon.
The two motorists were buying the same grade of gasoline, which more than likely came from the same refinery in El Segundo. Yet the prices they paid differed by 80 cents a gallon, or by more than $10 to fill an average 13-gallon tank.
Read More: http://www.latimes.com/business/la-fi-zone-pricing...
Top Opinion
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Resp 2013/01/02 22:05:26
Zone pricing is based on what a community can afford to pay in most cases. If you live in a small rural community, you likely have a lower cost of living on certain things... gasoline is one of those things.
But in a larger city where the cost of living on certain items is higher, you should pay a bit more.
Examine how the price of gas ranges from state to state.
You mentioned that in California they pay $4.69 a gallon in some places. In most of Alabama, we are currently pay around $3.13 a gallon.
What you need to focus on is how every time bad news comes out of the Middle East or Washington DC, the gas companies increase or lower the price of gas on a whim although the cost of a barrel of oil has not changed.
In the 1970's, they did this and the federal government went after the gas companies basing their claims on federal laws about profiteering which is a felony.
Profiteering is like after a hurricane hits, people show up selling a gallon of fresh water for $8.00 a gallon which is illegal.
What the gas companies are doing is profiteering yet the media, groups like the L.A. Times (who don't even read your replies after posting here) don't go after the gas companies for the crime they have been committing now for almost 13 years.
Look at how Diesel fuel ...
Zone pricing is based on what a community can afford to pay in most cases. If you live in a small rural community, you likely have a lower cost of living on certain things... gasoline is one of those things.
But in a larger city where the cost of living on certain items is higher, you should pay a bit more.
Examine how the price of gas ranges from state to state.
You mentioned that in California they pay $4.69 a gallon in some places. In most of Alabama, we are currently pay around $3.13 a gallon.
What you need to focus on is how every time bad news comes out of the Middle East or Washington DC, the gas companies increase or lower the price of gas on a whim although the cost of a barrel of oil has not changed.
In the 1970's, they did this and the federal government went after the gas companies basing their claims on federal laws about profiteering which is a felony.
Profiteering is like after a hurricane hits, people show up selling a gallon of fresh water for $8.00 a gallon which is illegal.
What the gas companies are doing is profiteering yet the media, groups like the L.A. Times (who don't even read your replies after posting here) don't go after the gas companies for the crime they have been committing now for almost 13 years.
Look at how Diesel fuel rose in price so that now it's higher than the gas you put in your cars. Diesel fuel has greater impurities and is cheaper because it undergoes less refining. So how is it that they sell a product that's cheaper to produce because it contains larger amounts of impurities for a higher price?
When you buy gas for your car, you have a choice between Regular, Unleaded and Super Unleaded. Using the logic employed by the gas companies, you should be paying more for Regular and less for Super Unleaded because Regular gas has greater levels of impurities... thus, it should be the next highest price to Diesel Fuel based on the impurities in it.
Zone pricing isn't a problem... four miles is nothing so drive to where it costs less to buy your gas, plan to buy your groceries and other items where you buy your gas.
Do that and you'll have all the local retailers up in arms and watch as the price of gas in your community drops.
Four miles... good grief L.A. Times, use some intellect when you address these matters and give people advice how to beat the system.
Should this be made illegal?
No... and if they try they'll likely be defeated.
Here in Alabama, we use the internet to see what the price of gas is.
Use http://gasbuddy.com/ and you can beat the system by using the system against itself. You might even find that friends and family or vacation spots are near places where the price of gas is cheaper so plan your trip in advance and carry a few five gallon gas cans with you.
Use your brain to beat the system... you don't need costly lawsuits and more government involvement, you just need to put your brain to work and exploit the system instead of leaving yourself as a victim.
After all, all you might accomplish by making this illegal is raising the cost of gas across the entire state of California to $4.69 a gallon when traveling just four lousy miles to do your shopping or visiting friends, you can buy it for $3.89 cents a gallon saving $.80 a gallon.
I travel almost 40 miles a day for therapy and this is what I do so no, I don't want this made illegal because I would rather find the cheapest gas rather than having it all be higher in price.
Also, notice how the L.A. Times pulled a fast one on the image they used?
One gas station is Self Serve and the other isn't.... lol, self serve stations always offer a slightly lower price per gallon because gas stations who pump the gas for you tack on a little extra to pay the salary of the person pumping your gas and checking under the hood for you and frankly, I would pay an extra ten cents per gallon to have it pumped for me and to have someone check all the fluids in my engine or deal with an overheated radiator... wouldn't you?
I do know that the price of a gallon of gas is steadily increasing even as we speak ........ and the media is eerily silent.
How's that hope and change working out for you folks.
Many gas stations are franchise owned. The business owner of one convenience store may choose to charge a higher price than the owner of another convenience store with the same exact name.
And the $1.20 cost will be gone the moment the other gas station breaks down in the face of free market economics and lowers its prices. All it requires is for people to have a brain. We dont need to bring the government into this.
I don't like throwing around the "c" word but this is obviously a part of COMMUNISM!
Reagan Killed it so His Buddies would have NO restrictions to get in the Way of Their WEALTH!