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New Straits Times (Malaysia): Fuelling frustration

Published: Aug 02, 2007

MALAYSIA’S petrol dealers must be desperately unhappy with their lot, judging by the confrontational efforts of the Petrol Dealers’ Association of Malaysia to improve it. A couple of years ago, the association threatened to stop accepting credit card payments, which account for more than a third of their sale transactions, because of the 1.25 per cent commission financial institutions levy on such transactions. On margins of eight sen per litre of petrol and 3.5 sen for diesel, these charges enabled banks to make almost as much as petrol stations on fuel sold.

This credit-card bugbear now resurfaces in the PDAM’s latest dire warning: Its members, representing the 3,200 stations of all major fuel retailers, now not only want to pass these charges on to the consumer but also want to restrict sales to between the hours of 7am and 10pm.

This risks an uproar. All motorists and vehicle operators, private or commercial, have taken recent hits of rising fuel prices, a primary component of the cost of living. They cannot be expected to take lightly the prospect of such expenses being nudged even higher because retailers want to trim their overheads. What’s really outraged road users, however, has been the alarming proposal to shut down fuel stations well before midnight. While the more established petrol companies, such as Shell, Petronas and ExxonMobil, with 830, 700 and 570 stations nationwide respectively, might have the heft and reach to field such a move, it could fatally undermine the efforts of smaller competitors such as Caltex or newer ones like BHPetrol, whose aggressive expansion plan on taking over the old BP franchise touts the virtue of its 245 retailers staying open 24/7.

Fuel is essential and fuel stations provide an indispensable service in dispensing it. The transport industry does not sleep, and knowing fuel is available around the clock contributes to social order in ways that might not be obvious until people start finding themselves stranded all night without it. This is not to say that petrol station operators do not have legitimate concerns over security to add to their long-standing dissatisfaction with their profit margins. But there must be ways to address such concerns – as well as that thorny matter of credit-card commissions – without having to hold consumers to ransom. If strong-arm tactics help get the PDAM the attention it wants with a view to redressing its members’ problems, well and good. But that should be the extent of it. Don’t hurt the consumer more.

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