Gas Stations
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 9,100 gasoline stations in the US sell automotive fuels, preferably at high-traffic locations, to individual motorists and fleets. Products sold include gasoline, diesel fuel, and gasohol. Other sources of revenue may include repair services, the sale of automotive oils, replacement parts and accessories, and/or providing limited food services.
Volatile Fuel Costs
With such low margins, gas stations have difficulty absorbing significant and sudden fuel cost increases.
Competition From Alternative Retailers
About 80% of all fuel sold in the United States is sold at convenience stores, according to the National Association of Convenience Stores.
Industry size & Structure
The average gas station employs about 7-8 workers and generates about $7-8 million annually.
- The gas station industry comprises 9,100 firms that operate about 12,900 stations, employ 96,200 workers, and generate about $99 billion annually.
- The industry is concentrated at the top and fragmented at the bottom: the 20 largest firms represent 56% of industry revenue.
- While some gas stations are owned and operated by refiners, most are independent businesses that purchase gasoline from refiners and petroleum wholesalers and market it for resale to the public.
- Many gas stations are unbranded dealers that sell gasoline produced by different companies. Branded stations may not necessarily sell the gasoline their companies produce.
Industry Forecast
Gas Stations Industry Growth
Recent Developments
Jun 26, 2024 - Gas Prices Ease
- Sales at gas stations declined by 1.6% in March compared to a year ago but rose 12.9% from February, according to the latest data from the US Bureau of Labor Statistics. Producer prices for gas stations were unchanged in April year over year. The relative price stability comes after producer prices for gas stations sank 18.6% between April 2023 and April 2022 after soaring 38% in previous annual comparison, BLS data show. The price per gallon of regular gasoline at the pump is falling, bringing some relief to motorists as they look toward the summer driving season. Meanwhile, employment by other gas stations, which excludes convenience stores, grew 3.2% in April compared to a year ago, while average industry wages rose 4.6% over the same period to a new high of $19.07 per hour, per the BLS.
- Sales of E15 fuel have risen for the past two years, and there's a strong indication the upward trend will continue, Fuel Market News reported in May. According to data from the Renewable Fuels Association, E15 sales surged last summer, with sales volumes from the Minnesota Department of Commerce (the only monthly E15 data set available) up 10% compared to summer 2022 sales. The EPA in February granted a petition from the governors of eight midwestern states to waive the 1-pound per square inch (psi) Reid vapor pressure (RVP) waiver for summer gasoline-ethanol blended fuels containing 10% ethanol (E10) in those states effective April 28, 2025. The Agency’s action also removed regulations that extended the 1-psi waiver to gasoline-ethanol blends between 10% and 15% ethanol (E15), per the Federal Register. E15 is available in 31 states at about 3,000 gas stations, according to the Department of Energy.
- US retail gasoline prices will average about $3.60 per gallon in 2024 and 2025 (up 10 cents from 2023), according to the US Energy Information Administration’s April 2024 Short-Term Energy Outlook (STEO). The April STEO forecast for retail gas (regular) is 10 cents per gallon higher on an annual average basis in 2024 compared with the March STEO, due to rising wholesale gasoline prices as well as higher crude oil prices. The EIA now forecasts the wholesale gasoline price will average more than $2.70/gal in 2024, also 10 cents/gal more than in 2023. The higher forecast wholesale gasoline prices compared with the March STEO reflects the agency’s expectation of more gasoline exports and lower gasoline inventories, leading to an increase in the 2024 annual average crack spread for gasoline relative to last month’s forecast.
- Oil giants Chevron and Exxon Mobil are developing cleaner gasoline as an alternative to electric vehicles, Fuel Market News (FMN) reported in December. Chevron and Exxon in April disclosed road test results from partnerships with automaker Toyota Motor Corp. using renewable gasoline partially made from soybeans or other non-fossil feedstocks. The blends could be used by the existing US car fleet and gas stations, according to the two companies. If made commercially available, the fuels could extend the life of the gasoline market as part of the world's transition to cleaner fuels and electric vehicles. Bringing the cost of these renewable gasoline blends to affordable levels would depend on supportive government policies, according to Exxon. Chevron added it could be years before the renewable fuel could be available in pumps, Reuters reported.
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