NPD, a company which first started offering fuel in 1969, is building two unmanned fuel stations in Dunedin.
One will be in Mosgiel and another in Kaikorai Valley. The Mosgiel site is expected to open at the end of March while the Kaikorai Valley site will open at the end of April.
NPD chief executive Barry Sheridan said the two new stations followed strong support in the city from its existing sites in Andersons Bay and Green Island.
"Kaikorai Valley and Mosgiel are both high-traffic locations where we see clear demand for competitively priced, self-serve fuel. By opening two new premium NPD self-serve sites, NPD will increase choice, convenience and competition for Otago motorists," he said.
AA fuel spokesman Terry Collins told the Otago Daily Times last week the introduction of two new low-cost stations was likely to cause more fluctuation in fuel rates.
"Generally what happens is when those low-cost operators come into an area and compete with the other ones they come in at lower prices and so the other stations generally have to try and match it to keep their customers," he said.
Mr Sheridan said experience across New Zealand showed increased competition helps keep fuel prices fair for everyone.
He said NPD’s retail growth had accelerated in recent years as the self-service network had expanded. It has 120 sites across the region.
"Over the past four years, we’ve developed 21 new sites throughout New Zealand. We currently have four sites under construction with another 11 to be built in the next 12 months."
"Fuel retailing is generally a ‘low-margin, high volume business’. NPD has lower cost-to-pump margins directly driven by reduced operating costs. Economies of scale is another key driver with this as NPD develops new sites, enhancing our NZ retail network."
NPD does have some manned sites which are run by independent operators under a supply agreement.
"Self-serve fuel is a growing part of the industry and reflects changing customer preferences for speed, convenience, and competitive pricing.
"That said, there will likely continue to be a mix of site models depending on location, customer demand, and community needs."
He declined to say what percentage of sales for the week were made on days when fuel was discounted.
"Fuel promotions naturally generate strong customer interest and increased volumes on those days. Customers clearly respond positively to opportunities on Discount Days for additional savings at the pump."
