ExxonMobil to Exit Gasoline Retailing
By Vladimir Posted in Energy | Exxon Mobil — Comments (2) / Email this page » / Leave a comment »
Well, it looks like you're going to have to redirect your ire over retail gasoline prices. (This means you, too, Congress.) As it turns out, most of the retail gasoline is sold by independent jobbers marketing under a major name, and by convenience stores and truck stops. The majors are really not a presence in gasoline retailing.
Exxon getting out of retail gas business
Exxon Mobil is getting out of the retail gasoline business, a market where profits have gotten tougher because of high crude oil prices.
The world's largest publicly traded oil company said Thursday it will sell its 820-company owned stations and another 1,400 outlets operated by dealers to gasoline distributors across the U.S.
The Irving-based company didn't disclose financial details but said the transition will take place over a "multiyear period."
However, motorists will continue to see Exxon and Mobil stations throughout the country. About 75 percent of its roughly 12,000 stations in the U.S. are owned by branded distributors. Exxon Mobil will still sell gasoline to those stations and get paid for the use of its name.
Based on my experiences in doing business with them, Exxon-Mobil is a company that that is extremely concerned about operating margins. They don't spend a dime if they can avoid it or if they can force someone else to spend it for them.
The downstream half of Exxon-Mobil's business is why their overall profitability has been so disappointing in recent quarters. Getting rid of marketing and distribution makes perfect sense, since there's no clear business case that the profitability of these operations can do anything but erode further.
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