⛽️ What's Going to Happen to Gas Stations?
And the people who work at them
Gas stations are dying
Hooray! No more climate change! Right?
Not so fast.
Gas stations are dying, but their death has implications for millions of Americans.
And they are dying fast, mostly because electric vehicles (EVs) are replacing internal combustion vehicles. Many cities have already banned the building of new gas stations, while states like California have forbidden the sale of gas powered vehicles altogether after 2035.
The only reason gas stations aren’t vanishing faster is because electric vehicle (EV) adoption has been a lot slower than expected in the United States. One of the reasons for that slow adoption has been the inconvenience of charging electric cars outside the home - EV chargers just can’t compete with the ubiquity of gas stations … for now.
Most gas stations are small businesses
It’s not uncommon for gas stations to be individually owned mom and pop shops. When you see Exxon on the sign, that’s the company filling the gas in the tanks - but they don’t typically own the actual gas station itself.
And most are owned by immigrants of color
While I’m onboard with the end of fossil fuel dependence, I’m not that happy that thousands of small minority owned businesses will fail.
Why do so many immigrants own or operate gas stations?
As new immigrants arrived to the U.S. they faced racism, or a lack of documentation that prevented them from joining the formal workforce. Self-employment was a viable alternative. There were other advantages. Working at a convenience store or gas station meant working with family or other immigrants, didn’t require great English proficiency, often came with existing clientele that didn’t require any sophisticated marketing to convert, and startup costs were low. And the immigrant super-power was and still remains, a willingness to move to random cities and work long hours in unpalatable conditions like gas stations, which are more often than not depressing and sometimes dangerous places to work.
And the immigrant super-power was and still remains, a willingness to move to random cities and work long hours in unpalatable conditions - something many integrated Americans are still unwilling to do.
Gas stations were the perfect fit for these kinds of immigrants looking to make a buck and since the 1970’s they have become a driver of economic empowerment and financial stability for millions of new Americans. Some gas station owners and operators have become extraordinarily wealthy and thus evangelists of the “American Dream” while others have achieved more modest but nonetheless laudable goals of saving enough to send their first-generation kids to college.
Here’s how immigrants can innovate … again
The good news is that gas stations don’t actually make their money on gas.
Vehicle owners spend about $22,000 on gas for the life of their vehicle. But if you’re thinking there’s good profit to be made by gas station owners here you’d be wrong. Gas station owners only pocket about 3 to 5 cents per gallon, most of the cash from gasoline sales goes to oil companies (shocking) and the rest goes to taxes.
Instead gas stations actually make most of their profits from selling you bland coffee and Flaming Hot Cheetos.
What this means is that even as fill-ups decline, gas stations can still remain viable profit centers as long as they can entice people to stop over to grab a bite. In fact, because station profit margins are already razor thin, decreasing reliance on gas as a revenue generator and increasing sales of other more profitable items may stabilize immigrant jobs.
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Here are five ways gas stations can innovate and withstand the impending shift to electric vehicle charging. Each of these suggestions takes gas stations back to the mid-century “service station” model when gas stations would actually provide services like car repair, grocery delivery, shoeshines etc., beyond just a fill-up:
Add EV charging. Gas stations are already located at optimum placement points for car traffic. Adding high-speed chargers for EVs only makes sense. More importantly, since electric vehicles take a lot longer to charge, customers are more likely to spend time buying Doritos and alcohol from gas station convenience stories, further increasing gas station profit margins.
Go digital. Why can’t you pre-order something from the convenience store so as you pump gas or charge an EV, your snacks and drinks are delivered to you? Or perhaps use the same technology to deliver a late night snack to your home? This is a trend with legs - we all hate to admit it, but 7-11 deliveries via Uber etc., have been so successful that the company just bought its own delivery startup.
Go mobile. Speaking of mobile, why not use the same infrastructure to have gas delivered to your vehicle remotely? Gas is portable in ways electricity is not. Someone could come and pump gas at the office while you work, or in your driveway at home before you head to the office.
Leverage real estate. Why can’t gas stations become drop-off centers for USPS or FedEx? Or an easy returns counter for online purchases? Lots of opportunities here.
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