Exxon Dealers Fear a Sellout
Exxon gasoline dealers in Southern California met for the third time in a month Thursday amid growing concern that Exxon U.S.A. intends to abandon the Southern California market and sell or close down their stations.
The dealers say that the gasoline retailing division of Houston-based Exxon Corp. has in the last few months altered policies in a way that they fear is designed to squeeze them out of business.
Exxon U.S.A. spokesman Les Rogers said Thursday that the company “declines to comment on future plans.”
Dealers say that Exxon has substantially raised its wholesale cost of gasoline to them, announced changes that will increase station rental fees a total of 75% by 1995, curbed station maintenance and begun testing the soil at all Southern California stations for contamination--a necessary step these days before any commercial real estate transaction.
“All of the indicators are that Exxon is on the verge of some form of market withdrawal from Southern California,” said Dick Wilson, executive director of the Southern California Service Station Assn., which represents dealers.
Louis James, an energy analyst, agreed.
“If they’re doing blanket testing, basically to see what their environmental liabilities are, it sounds like they’re trying to come up with a package” for sale or trade, said James, executive director of AUS Consultants, an energy and utility industry analysis group in Conshohocken, Pa.
Exxon’s 149 stations account for 3.4% of retail gasoline sales by volume in the greater Los Angeles market, according to the latest census by analyst Trilby Lundberg.
