Exxon Mobil to Sell 2,220 US Gas Stations
July 18, 2008
Exxon Mobil Corp. is the biggest oil business in the United States. The company owns a total of about 12,000 gas stations throughout America. Most of the stations are concentrated in California and New York, America’s most-populated and third-most populated states. Many Exxon Mobil stations are also to be found in the states of Texas, Maryland, Florida, Virginia, and Tennessee.
Yet, despite its size and seeming power, this oil behemoth is also suffering from the high oil prices that have hit American and the world of late. Prem Nair, a representative speaking for Exxon Mobil, explained: “The fuels marketing sector is a very challenging market.” The company is having trouble making a profit from many of its company-owned gas pumps.
Fuel prices per barrel have repeatedly set records during the past few months, and then broken them again. Even with fuel going for more than $4 per gallon at many of Exxon Mobil’s pumps, the company says that it is still having trouble making enough profit. Another difficulty for Exxon Mobil is competition from companies like Wal-Mart—”hypermarkets” that sell well-nigh everything, including gasoline, and can thus afford to lure customers away from traditional gasoline pump operators like Exxon Mobil with lower prices.
In short, as a consequence of these difficulties, Exxon Mobil intends to sell 2,220 of its 12,000 gas stations across America. That is approximately 1/5 of all of Exxon Mobil’s US gas stations. These gas stations are simply not profitable enough, according to the company’s representatives.
The difficulty for Exxon Mobil is not too great, however. The gas stations that the company plans to sell will still be carrying Exxon Mobil fuel and be associated with the Exxon Mobil name. Thus, Exxon Mobil hopes to profit from the continued existence of the 2,220 gas stations in question, but not incur the risks associated with trying to sell gasoline in during this period of great economic uncertainty and prohibitively high fuel costs.
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