Christchurch Gasoline Becomes Cheapest in New Zealand as Discount Stores Trigger a Price War at Pumps

Christchurch motorists are enjoying the nation’s cheapest gasoline for the first time in years as new discount stations arrive in the city.

Last week, the no-frills chain Gull launched in Christchurch with a new store on Stanmore Rd, Richmond.

This followed his discount partner Waitomo opening a station on Ferry Rd in Woolston last month, the second in town after opening the first on Fitzgerald Ave in December.

Both brands have a large network of stations on the North Island, where they have been driving price competition.

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This week, Christchurch drivers were pumping 91 regular gas for just under $ 1.75 a liter at discount stations like NPD and Pak ‘n Save, as well as Gull and Waitomo.

This is up to 10 cents cheaper than Auckland and Wellington, or $ 5 less to fill an average 50 liter tank.

Some outlets had diesel for less than 99 cents.

Filling up her car at NPD on Stanmore Rd on Friday, Anita Johnson of Invercargill said the prices were “great” and better than in her hometown.

In Auckland and Wellington, what’s known as the “Seagull Effect” has kept prices near discount stores low since the brand’s launch 20 years ago.

Mark Stockdale, AA’s gas price spokesman, said Christchurch now had the “highest prices” in the country, after years of South Islanders subsidizing cost cutting on the North Island.

He said price competition in the south started when South Island no-frills NPD started lowering prices ahead of Gull and Waitomo’s arrival from the North Island.

“This is what the competition looks like. It has been the case that prices in the South Island have been higher for years, and now that has changed, ”she said.

Low-cost brands typically competed with each other, and full-service brands would only lower prices if they were losing sales to a discount store, Stockdale said.

The cross-subsidy means that South Island motorists pumping the big brands have been helping fund discounts for North Islanders, he said.

After surpassing $ 2 a liter in January this year, prices in the city fell during the Covid shutdown to just $ 1.70, then slowly began to climb over the winter.

According to the Gaspy fuel pricing app this week, motorists could refuel 91 regular gas for $ 1.74 a liter at the new Gull, Allied on Wainoni Rd, NPD on Stanmore Rd, and Pak’n Save on Wainoni and Moorhouse Ave.

A batch of other discount stations, including Waitomo, were charging $ 1.79 a liter, with most of the major brands wanting between $ 1.80 and $ 1.90.

In both Auckland and Wellington, large discount stores charge between $ 1.85 and $ 1.88, and large brands charge up to $ 2.12 in Auckland and $ 2.05 in Wellington.

Gull is now owned by Caltex Australia, while NPD is privately owned by a Nelson family and Waitomo is owned by a King Country family who purchase bulk fuel from Mobil.

The new Christchurch Gull stands on the site of a former gas station. The chain is planning a second at a former BP station near Te Waka Unua school on Ferry Rd.

Stockdale said plain brands keep prices low by reducing overhead. This means little to no staff, fewer station facilities, and smaller sites where land is cheaper.

“It is giving South Island motorists a choice that Northern Islanders have had for a decade: you can go for the cheapest fuel or the full service station where you can stop and grab a snack.”