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Speaker 1: Commerce Commission, as I'm sure you're well aware, is way

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Speaker 1: back into the petrol market. Retailers too quick to put

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Speaker 1: the prices up, too slow to bring them down. Bill

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Speaker 1: for the behavior falls on the punting you and me

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Speaker 1: to the tune of fifteen million dollars a year. The Commission,

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Speaker 1: to Brian Chapel is with us. Very good morning, morning,

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Speaker 1: make How would you describe the market in Lamer's terms?

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Speaker 2: Is this a rought?

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Speaker 1: Are they ripping us off or not?

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Speaker 2: Look, I think it's just not as competitive as we'd like.

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Speaker 2: We can certainly see competition that's starting to improve. We

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Speaker 2: can see more of those unstaffed sites coming in and

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Speaker 2: bringing down prices in the areas around them. But this

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Speaker 2: study shows that, you know, prices going up faster than

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Speaker 2: they come down, that you know there's more work to do.

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Speaker 1: Their counter argument, as it always is the complexity of pricing,

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Speaker 1: because we all look at the price of a barrel

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Speaker 1: of oil and go hats down? Why and so it's

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Speaker 1: much more complex than that. Does your work take that

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Speaker 1: into account?

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Speaker 2: Well? A really good thing about this is it just

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Speaker 2: looks at increases and decreases and how they get treated.

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Speaker 2: And it's over quite a long period of time. So

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Speaker 2: this is a pre robust finding that prices go up

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Speaker 2: faster than they come down. I don't think they can

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Speaker 2: escape that.

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Speaker 1: Right, But they would counter it by saying, look, we

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Speaker 1: look at the price of a barrel of oil, it's down.

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Speaker 1: Why isn't the price down? And they go well, at

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Speaker 1: the same time the dollar moved as well, or the

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Speaker 1: cost of shipping changed, and therefore it all equated out.

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Speaker 1: Do you dismiss that or not?

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Speaker 2: Yeah, you'd have to say that on average. You know,

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Speaker 2: we're looking over several years, so there would have to

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Speaker 2: be a systematic change in the exchange rate or oil

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Speaker 2: prices or sorry not. You know, there'd have to be

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Speaker 2: a systematic change in some of their costs going in

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Speaker 2: different directions to explain this. And I just don't think

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Speaker 2: that's credible.

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Speaker 1: Okay, is it collusion, No.

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Speaker 2: There's no evidence that there's collusion. I think it's just

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Speaker 2: a you know, as one of the things factors they give,

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Speaker 2: it's they look at local competition, they see what others

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Speaker 2: are doing. If they're not forced to lower prices, they

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Speaker 2: don't necessarily do it.

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Speaker 1: So that's a market Why doesn't it work in the

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Speaker 1: sense we had the right time of people on Gull's

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Speaker 1: been a similar sort of player. They go, we're not

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Speaker 1: like them different we lead the market. If they lead

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Speaker 1: the market, why don't the majors follow?

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Speaker 2: Well, they do in the areas where those stations are,

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Speaker 2: and so you do see when a new station comes in,

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Speaker 2: it brings down prices in that area if it's one

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Speaker 2: of those unstaffed sites. So making it easier for them

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Speaker 2: to access fuel, which is what the regulatory regime does,

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Speaker 2: and then making it easier for them to open more

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Speaker 2: of their stations, which councils have a role in that helps,

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Speaker 2: and then motorists choosing to shop there that forces the

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Speaker 2: majors to allow prices to match.

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Speaker 1: Having muddied the waters, I think a little bit when

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Speaker 1: you talk about the tax rate coming off the Auckland motorists,

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Speaker 1: for example, I mean, of course it will come off instantly,

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Speaker 1: won't it, Because it's an external input. So in other words,

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Speaker 1: when the tax goes, it goes. It's easy, whereas what

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Speaker 1: they're arguing is the complexity of day to day pricing

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Speaker 1: is way more problematic than that.

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Speaker 2: I don't think it's maybeing the waters. I think if

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Speaker 2: there's a tendency for prices to come down more slowly

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Speaker 2: than they go up. We don't want to see that

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Speaker 2: happening when the fuel tex comes off.

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Speaker 1: Right, Sure of you saying what you've said, What else

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Speaker 1: can be done? What's been the point of this market study,

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Speaker 1: of your involvement in the market and all of this,

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Speaker 1: what's actually changed?

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Speaker 2: Well, what's actually changed is that companies like Way, Tomo

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Speaker 2: and Gull can now more readily get fuel at more

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Speaker 2: reasonable prices. And we've seen that they've been much more

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Speaker 2: able to open stations than was the case in the past,

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Speaker 2: and that that is driving down prices for Kiwi motorists.

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Speaker 2: So I think we've got evidence that it is working,

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Speaker 2: and so what perfect No, but it's working, Okay?

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Speaker 1: How much does the punter play a part in this?

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Speaker 1: In other words, if I wanted to put a bit

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Speaker 1: of energy into it, get a gas y app shop around.

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Speaker 1: There's plenty of competition and there's plenty of price by variability.

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Speaker 2: Yep, yep, especially in a place like Auckland. Look, Terry

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Speaker 2: Collins from the AA has been talking about that in

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Speaker 2: the last day or so. Is absolutely right. If everyone

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Speaker 2: shops at the lowest price station, the others are going

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Speaker 2: to have to match, all.

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Speaker 1: Right, Brian, appreciate time, Brian Chapple, who's the Commissioner the

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Speaker 1: Commerce Commission. For more from the mic Asking Breakfast, listen

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Speaker 1: live to News Talks at B from six am weekdays,

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