A FUEL price war has broken out. Trev’s Motorcycles slashed its petrol and diesel prices yesterday, undercutting its nearest rival by 2p a litre officially to become the cheapest in the island.
That title used to belong to Braye Road Garage, which had a two-page feature in the Guernsey Press yesterday stating that was the case.
Trev’s Motorcycles owner Trevor Hockey explained why he had done it.
‘This is not something that I have done in response to Braye Road Garage’s advert,’ he said. ‘This is something that has been carefully considered over a period of time.’
He was selling petrol at 61.9p a litre and diesel at 51.9, compared with his rival’s 63.9 and 53.5p.
Braye Road manager Dave Finn said he would consider cutting prices in response to Mr Hockey’s move.
‘We are trying to be the cheapest in the island so I will have to have a look at our prices,’ he said.
‘There is a small war going on at the moment but we will have to see what happens pricewise. I think there is a lot of competition in the petrol world.’
Fuel had a 2p per litre duty placed on it in the recent Budget and both petrol and diesel will be subject to a 27p a litre duty increase from 1 January to cover the scrapping of road tax.
Mr Hockey said he had not implemented the recent rise from the Budget.
‘We don’t want our customers going to our nearest rivals,’ he said.
‘We want to extend our client base. The oil market is very volatile at the moment. The price goes up and down like a yo-yo.
‘We have made a commercial decision to go for volume, not profit.’
But an industry insider, who asked not to be named, said small garages ran the risk of getting into financial difficulties by slashing prices but conceded it was inevitable because of the increased costs they faced.
‘It’s every man for himself at the moment,’ he said.
‘I think you will see some of these small garages running the risk of getting themselves in serious trouble. You cannot just lower prices with the way the costs are at the moment.’
Mr Hockey confessed it was a bold move.
‘We are known for delivering real value for money fuel prices since we first introduced discounted fuels for everyone way back in 1990 and we intend to continue offering a great deal for the foreseeable future,’ he said.
Dave Beausire, chairman of the Guernsey Motor Trades Association, declined to comment.
* The States has already warned that it will look to crack down on dealers who mark up fuel after the Budget increases.
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