As the first of the gas price signs go up at service stations in Cayman, there is still concern within the industry that the new mandate could prove too competitive a market for smaller dealers.
The deadline set for the price display signs to go up is 31 March.
The mandate was brought in recently by the government to allow consumers to see what prices are on offer before driving up to the pump.
Country Manager with Esso Standard Oil Ltd, Alan Neesome reiterated his concern regarding the small service stations that have to compete with the larger stations.
The larger ones have convenience stores attached, allowing them to reduce their prices at the pump. The smaller service stations have lower volumes of gas and are much more exposed to price competition, he said.
‘What is happening is the public is being sensitised to only consider price now, instead of service,’ he said.
However, pointing out that the government does not agree that this will negatively affect smaller stations, Mr. Neesome asserted that the concern would have to be borne out. ‘It may not have an effect at all,’ he said.
Some signs that have been erected are only visible going in one direction past the service stations.
For example, at 4 Winds Esso at the four-way stop in West Bay, traffic travelling north can see the sign from the road, but those travelling south cannot, as the sign faces south.
However, Mr. Neesome assured the Caymanian Compass that Esso Ltd. is not trying to hide the signs, but has to take into consideration many factors for their placing.
‘We had meetings with Planning on this, and we had to ensure they (the signs) do not restrict access and exit points,’ he said.
Set back limitations also have to be adhered to, he noted.
In some instances, he said, a compromise has had to be made on where the signs are placed. Four winds and Mostyn’s Esso in Bodden Town were two such service stations, he said.
‘We have not been trying to hide the signs, but they can’t create a hazard,’ he said. ‘At the smaller stations we have to be selective where we put the signs.’
The more room available at the service station, the more prominent the signs are likely to be, he said.
While it is the responsibility of the two oil companies, Esso Ltd. and Chevron (Texaco) Caribbean Inc, to supply the signs, as the dealers set their own prices at the pumps they must also adjust the prices on the signs accordingly.
The new requirement to post the price of fuel in visible locations was put in place to help consumers.
When he introduced the measure, Leader of Government Business Kurt Tibbetts said, ‘Global fuel prices are out of our hands, but there are some ways we can try to mitigate them here.
‘One easy and important thing that can be done to promote competitive pricing is to require gas stations to post their prices in a way that gives passing motorists a chance to see the price before they drive up to the pump,’ he said.
‘This is done in many other jurisdictions and we feel it will be an effective way to regulate retail prices here as well.’
Mr. Tibbetts was not available by press time for comment on concerns that the price signs my have on smaller dealers.
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