SALE OF PETROL

Taranaki Daily News, 18 November 1933, Page 9

SALE OF PETROL

MINIMUM PRICES ADVOCATED. REQUEST BY PETITIONERS. The fixation by Order-in-Council of minimtun prices for the sale of petrol so as to prohibit what is described as “unfair competition” in this trade is the object of petitions from the New Zealand Farmers’ Union and the Associated Motorists’ Petrol Company Ltd., which was presented in the House of Representatives on Tuesday by Mr. J. Linklater (Co., Manawatu). Mr. Linklater presented a third petition from the South Island Motor Union on similar lines.

The petitions from the company and the Farmers’ Union are identical. They state that the membership of the company is more than 9000 persons, and that these have contributed share capital to the extent of £125,000. Before the incorporation of the company, continue the petitions, five major oil companies operated in and controlled the New Zealand market for petrol. From time to time they were faced with competition from independent importers, but they were able to eliminate this competition either by purchase of the competing interests, by price-cutting, or the threat of price-cutting, or by other pressure. When the Associated Motorists’ Company offered petrol at a price of one penny to twopence below the prices for second grade and first grade petrol of the major companies and at more favourable prices to its members, the major companies embarked on a policy of steadily reducing prices. Each such reduction had been followed by a similar reduction by the Asociated Motorists’ Company. The petitions continue: “During this period of reduction the landed cost of motor spirit has gone up steadily so that now the major companies are selling at much below what they themselves have previously shown in the statements as to their overhead expenses to be the price at which they can profitably sell, and the ruling prices at the moment are such that neither the major companies nor Associated Motorists’ Petrol Company can carry on without capital losses.” The petitions were referred to the Industries and Commerce Committee.