Petrol discounts to inflame supermarket wars

Supermarket wars between the duopoly that controls New Zealand's grocery market have spilled over into petrol discount schemes that could knock 2.8 per cent of transport fuel bills.

Oil company Shell and supermarket chain operator Progressive Enterprises were first off the mark with the launch of their linked grocery fuel discount scheme.

But within hours, rival Foodstuffs, which operates the New World and Pak 'N Save chains, said it was tying up with BP in a scheme to be launched next month.

Foodstuffs chief executive Tony Carter said BP had been working on its scheme for a year and it was not precipitated by the Shell-Progressive announcement. However, its hastily put together announcement said a list of participating supermarkets and BP stations would be announced soon.

The two rival chains are vying to control or thwart the other from controlling discount retail chain The Warehouse. Woolworths and Foodstuffs have spent $200 million and $150 million respectively to buy 10 per cent stakes.

Under the Shell scheme, due to start on Monday, people who shop at any of Progressive's 153 Woolworths, Foodtown and Countdown supermarkets and spend $40 or more, will receive a fuel discount voucher allowing the holder to cut 4 cents per litre off the pump price at Shell stations.

With the Shell-Progressive scheme, one discount voucher can be used per transaction, to purchase up to 100 litres of fuel.

Foodstuffs, which has 57 per cent of the groceries market against Progressive's 43 per cent, said its discount fuel docket scheme with BP would offer similar discounts.

Foodstuffs already runs a similar scheme with 20 Pak 'N Save stores and a couple of its New World stores. People who buy over $150 of groceries get 6 cents a litre off petrol bought at dedicated Pak 'N Save fuel stations.

Mr Carter said the co-operative still planned to roll out the dedicated supermarket petrol stations at New World and Pak 'N Save.

He said supermarkets were simply following overseas trends of getting into banking, general merchandising, petrol and stand-alone liquor sales.

Woolworths runs a similar fuel discount scheme in its home base in Australia and other supermarkets there are mostly linked to a scheme.

Shell's general manager of retailing, Mark Forsyth, said customers could still get points through its Fly Buys loyalty scheme.

Ironically, Foodstuffs' supermarket chain, New World, is part of the Fly Buys scheme.

The new discount scheme is not available to commercial customers who use a Shell Card, which already offers discounts.

- NZPA