Texas, Mexico Retail Fuel Mkts Seeing Mini Phenomenon in Branding Strategies
Texas, Mexico Retail Fuel Mkts Seeing Mini Phenomenon in Branding Strategies
A mini phenomenon is occurring in the U.S. and Mexican retail fuel markets
involving Pemex-branded fuel.
Mexicans in Texas have been flocking to the handful of Pemex branded retail
stations stateside, proving Pemex's marketing strategy of targeting the Hispanic
population in the U.S. to be on the mark. Conversely, many Mexicans in Mexico
are making a beeline to buy fuel from the growing number of new international
branded gasoline stations in Mexico, including Shell, Arco, Chevron and BP.
Some industry sources told OPIS that the motivations behind the strong demand at
Pemex-branded stations in the U.S. and the international branded fuel pumps in
Mexico are different.
Pemex opened its first store in the U.S. for the first time a few years ago in
2015 to significant fanfare, completed with el mariachi performance and
celebrations at the official opening of the first store at Pasadena, south of
Houston. Since then, sources said that there is an increasing Pemex brand
loyalty in the U.S. among Mexicans and the Hispanics population in Texas.
Also, Pemex-branded stations in Texas are drawing in the crowd with authentic
Mexican food and merchandise, and ultimately, fuel prices at Pemex stations are
considered very competitive, sources said.
On Friday, regular gasoline at Pemex station in Pasadena was priced at $2.63/gal
if paid by cash, and payments by credit cards are 10cts/gal higher. This was
compared with $2.69-$2.75/gal cash at two Shell stations and $2.59/gal for at a
Murphy USA station nearby.
Besides Pasadena, Pemex has four other retail stations in Texas, including
McAllen, El Paso and Brownsville.
OPIS reported earlier this year that the first Pemex retail branded gasoline
station in California popped up in Hanford in the Central Valley as Pemex
planned to expand its retail station network into California.
Mexican sources told OPIS that Pemex's retail expansion into the U.S. was in a
direct response to the expansions of U.S. and international oil companies into
the Mexican retail and wholesale fuel markets amid the ongoing Mexican energy
reform. Pemex's focus is now on expanding Pemex branded and possibly unbranded
fuel sales in the U.S. It is noted that Pemex does not have a presence in the
U.S. unbranded wholesale fuel rack markets so far, but that may change later.
Pemex is targeting regional markets in the U.S. with a high concentration of
Hispanics population, including California, Texas and possibly Arizona. In
California, Pemex is aiming to have 20 Pemex-branded stations this year, and
possibly another 20 next year. Unlike the five stations in Texas, Pemex will not
own these retail stations, which will be on a 20-year branded fuel supply
agreement with Pemex via a third-party marketer in the U.S.
Over in Mexico, international retail fuel brands are slowly adding more
stations, aiming to break Pemex's monopoly of that downstream market. The
growing expansion of foreign brands in Mexico may represent a significant and
symbolic change, but it is unlikely to make a large dent on Pemex's market share
anytime soon, sources said.
International retail brands offer an assurance of fuel quality and services as
well as accountability in fuel volume purchased, sources said. In Mexico,
consumers, retailers and wholesalers have been grappling with ongoing issues of
fuel thefts. Sources had said that consumers expect not to receive the full
volume they pay for at the pumps, and this shortchanging of fuel supplies is
prevalent in the entire supply chain from the refineries to the pumps.
International branded retail prices in Mexico are expected to be slightly more
expensive than Pemex brand gasoline, but international branded retailers
maintained that they would stay competitive on the streets. It is possible that
some consumers in Mexico could be willing to pay a price premium for branded
fuel and better services.
--Edgar Ang, eang@opisnet.com
involving Pemex-branded fuel.
Mexicans in Texas have been flocking to the handful of Pemex branded retail
stations stateside, proving Pemex's marketing strategy of targeting the Hispanic
population in the U.S. to be on the mark. Conversely, many Mexicans in Mexico
are making a beeline to buy fuel from the growing number of new international
branded gasoline stations in Mexico, including Shell, Arco, Chevron and BP.
Some industry sources told OPIS that the motivations behind the strong demand at
Pemex-branded stations in the U.S. and the international branded fuel pumps in
Mexico are different.
Pemex opened its first store in the U.S. for the first time a few years ago in
2015 to significant fanfare, completed with el mariachi performance and
celebrations at the official opening of the first store at Pasadena, south of
Houston. Since then, sources said that there is an increasing Pemex brand
loyalty in the U.S. among Mexicans and the Hispanics population in Texas.
Also, Pemex-branded stations in Texas are drawing in the crowd with authentic
Mexican food and merchandise, and ultimately, fuel prices at Pemex stations are
considered very competitive, sources said.
On Friday, regular gasoline at Pemex station in Pasadena was priced at $2.63/gal
if paid by cash, and payments by credit cards are 10cts/gal higher. This was
compared with $2.69-$2.75/gal cash at two Shell stations and $2.59/gal for at a
Murphy USA station nearby.
Besides Pasadena, Pemex has four other retail stations in Texas, including
McAllen, El Paso and Brownsville.
OPIS reported earlier this year that the first Pemex retail branded gasoline
station in California popped up in Hanford in the Central Valley as Pemex
planned to expand its retail station network into California.
Mexican sources told OPIS that Pemex's retail expansion into the U.S. was in a
direct response to the expansions of U.S. and international oil companies into
the Mexican retail and wholesale fuel markets amid the ongoing Mexican energy
reform. Pemex's focus is now on expanding Pemex branded and possibly unbranded
fuel sales in the U.S. It is noted that Pemex does not have a presence in the
U.S. unbranded wholesale fuel rack markets so far, but that may change later.
Pemex is targeting regional markets in the U.S. with a high concentration of
Hispanics population, including California, Texas and possibly Arizona. In
California, Pemex is aiming to have 20 Pemex-branded stations this year, and
possibly another 20 next year. Unlike the five stations in Texas, Pemex will not
own these retail stations, which will be on a 20-year branded fuel supply
agreement with Pemex via a third-party marketer in the U.S.
Over in Mexico, international retail fuel brands are slowly adding more
stations, aiming to break Pemex's monopoly of that downstream market. The
growing expansion of foreign brands in Mexico may represent a significant and
symbolic change, but it is unlikely to make a large dent on Pemex's market share
anytime soon, sources said.
International retail brands offer an assurance of fuel quality and services as
well as accountability in fuel volume purchased, sources said. In Mexico,
consumers, retailers and wholesalers have been grappling with ongoing issues of
fuel thefts. Sources had said that consumers expect not to receive the full
volume they pay for at the pumps, and this shortchanging of fuel supplies is
prevalent in the entire supply chain from the refineries to the pumps.
International branded retail prices in Mexico are expected to be slightly more
expensive than Pemex brand gasoline, but international branded retailers
maintained that they would stay competitive on the streets. It is possible that
some consumers in Mexico could be willing to pay a price premium for branded
fuel and better services.
--Edgar Ang, eang@opisnet.com
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