Why hike Saturday when Thursday will do?

Wednesday, February 26, 2014, 6:30PM:  Although I am still perplexed about what happened last week, I have some clarity about what will happen tomorrow.  Last Thursday, on Grand Rapids Gas Buddy, there were postings of several stations at a new price of $3.65.   Then, a few hours later, those postings were gone.  Instead, on Saturday morning, we got our third Saturday hike in a row, and of course the new price was … $3.65.  Retail prices have been following higher wholesale prices, which we usually see in February, particularly in regions influenced by Chicago.  Well, we have a new high for 2014 in wholesale prices tonight, and I calculate the cost to retailers to be $3.59 a gallon.  Since prices in and near Grand Rapids are in the $3.44-$3.65 range, we are looking at price hike on Thursday.  Estimated new price:  $3.75. –Ed A.

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117 comments on “Why hike Saturday when Thursday will do?
  1. renbutler says:

    “I have reduced annual driving from ~12k miles in 2010 to >5k in 2013. I am on track to sell my motor vehicle over this summer season.”

    That’s great! Take matters into your own hands, instead of waiting for “somebody to do something.”

  2. TimmP says:

    MrT…That is what I have been attempting to say for a long time, but some here assume I am missing something, when I am just TIRED of the need to play the game. I have been beating the system since the late 1970’s when Checker and Bonded were doing the spikes, 5 to 8 cent ones. There is a reason that this only happens where Speedway is. And I believe it increases traffic by making people top off their tanks often, and increasing traffic increases the profit inside on the snacks, the coffee, etc. Stations DO NOT USUALLY need to spike 35 cents to restore profits. We who beat the system reap the benefits. But those that don’t beat is far outweigh us, obviously, or Speedway would not continue to drive the retail market in this manner. I too have reduced my driving from over 18K a year to just 8K. Anytime I can work from home, is $10 (post taxes)in my pocket.

  3. Ren says:

    I think we understand by now that you’re tired of it, but please don’t mess with anybody else’s ability to buy low by advocating a change. That’s all I ask.

  4. TimmP says:

    …As I said directly above….”We who beat the system reap the benefits” Those who don’t far outweigh us, and thus it still makes marketing sense for Speedway, and we who beat it can continue to get the cheaper end of the stick. Thanks to all you who don’t play the game to win. (LOL)

  5. Eric says:

    There seems to be a little of a gas war in Daleville Indiana. The spike to #3.79 must not have included the pilot stations on either side of I-69. While McClure and BP and Speedway rose from #3.49 to $3.79 the Pilot stations stayed right where they were. Speedway and McClure then dropped to $3.55. They still can’t match the price of either Pilot station. Needless to say the Pilot stations were quite busy.

  6. Chris says:

    See my comments above on Daleville, Eric.

    Speedway shot up 30 cents and Pilot dropped all in an hour stretch and the drop actually held. I was in Anderson today just laughing at all the $3.79 gas prices.

  7. Turbo46032 says:

    Patrick,

    I was not talking about Ford…. I did not say EVERY car company CAN do it, only those who think about it a bit more. The car company I know of did it for a simple reason. They got burned once and missed the boat. So, they designed their manufacturing processes to build cars with a few basic ‘tools’. They designed the car to be built by the manufacturing process rather than the other way ’round. No changeovers. Ever. Again.

    I’m familiar with refinery affecting prices in other places. But we seem to be having a lot of ‘issues’, and you can provide all the explanations from the book, but I’ll believe it when a squirrel takes out a car assembly plant. The oil industry simply lacks credibility with its consumers. It’s that simple.

    BP lobbied for years to expand its refinery in Whiting, feeding our hopes for more stable prices. Instead what did we get? the most volatile prices in the whole country. That worked well…

    Now, about why Speedway does it. Ren’s answer does not make sense. If you hold the price relatively stable, only increasing or decreasing as needed by refinery/crude changes, you will NOT raise the price by 51 cents then drop 5 cents a day. I have lived in places where this does not happen, period, and people survived, and gasoline sellers survived. Nothing to it. Does Speedway know something in their little kingdom that the rest of the country does not? Pray tell.

    The closest I can get is ‘because they can’. I have no problem with it, if I ever find $4B to build my own refinery I won’t be too concerned. But I won’t play games with my customers either. You want to price gasoline as much as you want? Feel free to do so. Don’t play games with your customers. It’s not worth their time and it’s not worth your loss of goodwill, and certainly it’s not worth the wrath of the regulators.

    We can sit here and wink wink and pretend it’s all free market. Or we can drive to Tennessee or North Carolina where they seem to have a different version of ‘free market’ that works just as well without alienating the customer base.

  8. renbutler says:

    No winking, no pretending, there’s lots of competition in this free market, and these guys can predict prices using fairly basic math.

    Perhaps you SHOULD just go to North Carolina so that you’ll never have to rant about gas prices again. This market is obviously causing you a great deal of stress.

  9. Eric says:

    Thanks Chris, I visit this site almost daily and read all the comments, somehow I must have not seen yours, sorry about that. Did you see now Speedway has lowered their price to $3.49 to match Pilots? McClure is still at $3.55. I do not consider myself an expert to the game. But I have read enough to know more than the average Joe. Seems odd that Speedway spiked up to $3.79 and then one hour later dropped to $3.55 and now of course to $3.49. So the question is are they losing money per gallon now or just not making up to 30 cents profit per gallon? I’m going to pick the later. I find it hard to believe they are losing 2-4 bucks per vehicle leaving the station.

  10. Turbo46032 says:

    Ren wrote: “Perhaps you SHOULD just go to North Carolina so that you’ll never have to rant about gas prices again. This market is obviously causing you a great deal of stress”

    And miss out on our daily Speedway entertainment?

  11. Chris says:

    I saw the Speedway $3.49 price Eric as I was getting on the I-69 SB ramp today. I consider myself somewhere along the lines of a informed amateur to the gas game if there is such a title, but just paying attention to this site and watching gas signs in my travels has helped quite a bit.

    Did you notice when this Speedway location was still Gas America about 12-18 months back that they were not always the first ones at exit 234 to raise their prices? Now that Speedy has taken over its guaranteed they’re the first ones to spike…just took a sign change LOL.

    Daleville will probably be punished heavily when the next spike rolls around. Anderson & Muncie are just now starting to see prices roll back into the mid $3.65 range. My weed eater and blower take mid-grade gas, so tomorrow I’ll take advantage of the price drop and fill my cans up in preps for warmer temps.

  12. ChrisDG74 says:

    Looking at gasbuddy, sw Ohio is/was above the national average:
    now(by almost 19 cents),
    a week ago(by 3.5 cents),
    a month ago(12 cents),
    a year ago(2 cents).

  13. Turbo46032 says:

    Filled up the Honda Fit and my gas can for $30.00 at Costco at 3.39…

    Just for kicks, and I am aware of Costco and Sam’s Club selling gasoline without too much worry about making a profit… Their pricing model does NOT include spikes of more than 5 cents a day, none that I have seen so far. They do not bottom out as low as the low-low-bottom of the curve stations, nor do they top the charts at the height of the spike. So, they seem to make do with fewer spikes/drops, and not as severe ones when they spike.

    Again, I realize the Big Parent behind the curtain, but is it too much to expect from our gasoline retailers at Meijer, Kroger, et. al. that have similar Big Parents to act more like Costco and Sams instead of acting more like Speedway?

    Not that Costco is infallible. The NW Costco is 8-10c pricier, pretty much always…

    Just some gasoline into the fire, I guess.

  14. renbutler says:

    If Meijer and Kroger had customers paying annual fees, perhaps it would be different…

  15. Turbo46032 says:

    Maybe we could come up with a new pricing model! Pay $55 a year to Speedway to become a member and get Costco pricing :-)

    If you always buy at Costco/Sams (which I do) you pay pretty low. Today’s 9 gallons for the Fit would have cost me another $3.00 almost. Times 52 weeks that’s $150. If you drive something more thirsty you could save even more.

    But, since reality is a harsh mistress, I’ve been a member at Costco for a decade and at Sams for 5 before them, and each and every year from Costco at least I got my membership money refunded at the end of the year (cash back). So to me as a consumer there’s no cost. I probably fill up at Costco 40 out of 52 weeks.

    Now, ask me how many times in the last decade I’ve filled up at Speedway of Indiana, or I have gone inside for a purchase. Zero and zero…

  16. TimmP says:

    With Ricker’s Auto Debit Reward Card, I can and every time, do, beat my local Fort Wayne Sam’s Club. I never go inside at Rickers, and there is no minumum, just about no maximum for a family fleet of cars. Sams is OK, used them a lot prior to Rickers, but they in no way subsidize their pumps with the yearly subscription fee. Even w/o gasoline purchases, that fee is paid for by mid April.

  17. Tuebor says:

    There seems to be a lot of focus on the refineries, but what about the pipeline network? BP and others have expanded yet the major feed of northern oil to the Chicago market is Enbridge’s Lakehead system, which has been on proration for months, so the refineries can’t get the full amount of crude they want in each delivery.

    What about the refined product system? Buckeye, Wolverine, and Marathon seem to be the dominate suppliers to terminals in the affected areas. Are they running tight cycles? How much of their capacity is used for something other than gasoline/diesel?

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