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ABC Accuses Gas Stations of 'Luring' Customers with Price 'Bait-and-Switch'

     Gas station owners, defended as victims of Big Oil by some in the media, are guilty of “luring” customers to their pumps and then pulling a “bait-and-switch” with a credit fee, according to ABC’s “Good Morning America.”

 

     “Most drivers don’t carry enough cash to be able to afford for gas at these record prices,” ABC correspondent Bianna Golodryga said in a June 9 report. “But take a look at what happens when you swipe: $4.27 turns into $4.35.” The gas station in question displayed a price sign for regular unleaded at $4.27. But after she used a credit card the price went up to $4.35.

 

     The segment suggested “outraged” drivers were being swindled into paying more for gas than was advertised. But the pump featured in Golodryga’s report clearly listed a $4.35 price tag for credit purchases.

 

     The increase at Golodryga’s station was about 2 percent, the same fee retailers pay credit card companies. ABC portrayed the price hikes as more sinister than owners offsetting costs involved in selling gas on credit – despite the fact drivers could still pay the lower price in cash.

 

     Michele Mount, a spokeswoman for AAA, called it a “typical bait-and-switch,” although video used in Golodryga’s report showed at least some stations clearly noted their posted price for “cash purchases.”

 

     Mount told “Good Morning America” another reason gas stations offer cheaper gas for cash is so customers have to go inside to pay, “because while you’re there, you’re going to also pick up a coffee, a soda, maybe even a sandwich.”

 

     But Kathy Chu explained in USA Today July 7 that “a growing number of gas stations across the nation are launching promotions to encourage drivers to choose cash over credit. They're doing so because as gas prices rise, so do credit card fees, thereby cutting into the stations' already slim profit margins.”

 

     Golodryga shared clips from an ABC affiliate showing a gas station that allegedly hiked its price 50 cents per gallon for credit card users.

 

     “Does that seem like a lot to you?” the reporter asked the man behind the counter. “Do you use a credit card when you fill up here?” He answered, “No,” and the reporter said, “I didn’t think so.”

 

     But National Association of Convenience Stores spokesman Jeff Lenard told the Business & Media Institute such a hike is extremely rare.

 

     “That is not the industry by any stretch,” he said, adding that when gas stations do add a surcharge, “they get the sale but they don’t get the customer. That is not a way to stay in business.”

 

     As for the “misleading signs,” Lenard explained that states have different laws concerning what they’re allowed to post. “In Connecticut, their law was such that if anyone complained, you had to change your signage. You may have someone coming that is prone to confusion, maybe on their cell phone and not paying attention, who will complain. So gas station owners asked for more guidance from the state.”

 

     He also explained that one way or another, either the cash customer or the credit card customer is going to get hit. When gas stations don’t have a cash benefit, they lose the cash customers. When they do, the credit card customers think they are paying a surcharge when they’re not, and they take their business elsewhere, he said.