Petrol Stations Likely To Be Hard Hit

[george]

Petrol stations likely to be hard hit

New hours could force 25% out of business

BANGKOK: -- Nearly a quarter of the petrol stations in Thailand could be forced out of business this year under a proposed rule to restrict their operating hours to 10 pm.

Sompop Tanateerapong, chairman of the Oil Traders Association, said that up to 5,000 petrol stations, mostly privately owned, independent ones, could face shutdowns as a result of the new restriction.

Only the largest stations owned by top local and foreign oil companies will be able to survive, he noted.

The Energy Ministry next Tuesday will propose a number of new measures aimed at curbing fuel and electricity use, including forcing petrol stations not located on major thoroughfares to close two hours earlier, or at 10 pm.

Mr Sompop said smaller independent stations were already struggling, with marketing margins of just 30 satang per litre and few options to help boost revenues to cover operating costs.

''Many of these smaller stations just don't have the capital to invest in supplement businesses such as mini-marts, auto-repair or food services,'' he said.

''For an independent station to survive, the minimum marketing margin should be 90 satang to one baht per litre.''

Margins over the past two years have fallen sharply due to rising oil prices and competition among station chains. Local oil companies, with the notable exception of state-owned PTT, plan to raise their fuel prices by 40 satang a litre today, putting 95 octane premium petrol at an all-time high of 25.34 baht per litre and diesel at 21.79 baht.

Mr Sompop said that of the 5,000 stations that could close this year, 3,000 would likely look to relocate to more promising areas. Around 1,000 stations have already closed since the beginning of the year.

According to the Energy Business Department, there are 19,082 licensed petrol stations in Thailand. Around 5,000 are owned and controlled by oil companies, with the rest operating independently.

Mr Sompop said the restriction, if necessary, should be applied across the board, rather than selectively by location.

''Personally, I have nothing against the proposed law. Actually, station owners will potentially save hundreds of thousands of baht each month in electricity and water bills by closing earlier,'' he said.

''But any measure should not discriminate. All stations should have to stop operating at the same time.''

Manoon Siriwan, a senior executive vice-president at Bangchak Petroleum Plc, said he believed that the number of stations likely to be affected by the proposed measure would be relatively small.

''Most station owners that survived the 1997 crisis know what to do, and have made adjustments over the past several years by expanding to supplementary businesses,'' he said.

Other measures being sent to the cabinet include requiring billboard lights to be switched off from 9 pm to 5 am, making department stores and malls arrange more parking space for taxis, and increasing electricity charges for large users.

Cherdpong Siriwit, the permanent secretary of the Energy Ministry, said several of the proposed measures had been rejected earlier as impractical, including calls to raise excise taxes for cars with engines larger than 1,800cc, and the introduction of a more flexible work week for civil servants and state-enterprise employees, with Mondays designated as the official ''family day''.

Other business operators potentially affected by the new measures criticised the policies as impractical, ineffective and unlikely to result in significant savings for the country.

Noppadon Tansalarak, the president and CEO of Master Ad Plc, the country's largest billboard-advertising firm, said companies had already turned off their billboard lights at 10 pm and most had used energy-saving lighting systems.

He added that the Bangkok skyline would lose much of its ''charm and beauty'' if billboard operators were forced to close even earlier than this.

Leading department store operators also criticised plans to allocate more space for taxis and impose new taxes for parking lots. ''The government's energy-saving measures are not creative. The solution does not hit the bull's eye. What they need to do is focus on [changing] consumer attitudes. Why doesn't the government just let diesel [price] float freely, which will eventually result in lower consumption?,'' one top executive said.

Local investors mostly ignored talk of the conservation measures but instead focused more on growing regulatory pressure against day traders. The Stock Exchange of Thailand index slid for the third straight day, closing at 663.52, down 6.26, in trade worth 14.15 billion baht.

Warut Siwasariyanon, a vice-president for research at Globlex Securities, said the measures would have limited impact overall. ''Even if you close retail outlets sooner, people will still buy what they need to buy, and will just go shopping at different times,'' he said.

''Frankly, I think they should just let prices rise. Consumers then can make their plans on their future spending.''

--Bangkok Post 2005-07-06

[Captain Haddock]

"He added that the Bangkok skyline would lose much of its ''charm and beauty'' if billboard operators were forced to close even earlier than this."

[PeaceBlondie]

"Cherdpong Siriwit, the permanent secretary of the Energy Ministry, said several of the proposed measures had been rejected earlier as impractical."

And were these impractical proposed measures also the late afternoon brainchild of Thaksin's soon-to-be-reshuffled-yet-once-more-again Cabinet? Is this the cabinet of the same Prime Minister who talked yesterday about long range and medium range goals? The cabinet whose ministers always have a half-cooked 'idea de jour' to announce, never to see the light of day again?

What happened to that proposal to have 10,000 farang teachers, rotated every 90 days? What happend to all those other cockamany ideas, like importing English teachers from.....no kidding, last month, BHUTAN? And the idea of Thailand becoming the Detroit of Asia, even though it has no high-quality engineering test facility? And all those hundreds of unbelievable announcements that you old Asian hands have heard countless times.

Hey, folks, this is Thailand, and this is its government speaking!