Exxon Brand Exits New York

Exxon, Mobil merger bringing about changes now; many switching to Gulf Mar. 05, 2009

ROCHESTER, N.Y. -- The garages are still open and the pumps still work, but Exxon-branded gas stations are gone from New York state, reported The Democrat & Chronicle. The quick disappearance of the high-profile gasoline brand stems from Exxon Corp.'s merger with Mobil Corp. in 1999. At that time, the Federal Trade Commission (FTC) filed antitrust charges against the company, a portion of which alleged that the merger would hurt competition in the Northeast, where Exxon and Mobil were major competitors. In response, ExxonMobil agreed to divest interests in one of the [image-nocss] brands, which would differ from state to state. New Jersey, Pennsylvania, Delaware, Maryland, Virginia and the District of Columbia would keep their Exxons. In New York, Maine, New Hampshire, Vermont, Massachusetts, Rhode Island and Connecticut, the Mobil stations would remain.

But owners of Exxon stations had to make a choice. They were allowed to keep the Exxon logo for 10 years, but then had to either sign on with another company or operate as an unbranded station. Most were not allowed to switch over to Mobil because of the company's proximity rules, said the report.

A handful of Exxon owners chose to go unbranded, including Craig Barrese in Pittsford. "You have to sign a contract if you go with a name brand," he told the newspaper. "Unbranded, I can buy gas from anybody I want and post a lower price and try to be competitive."

Many others have chosen to sign on with Gulf, the report said. The transformation happened almost overnight, and the sight of the once-prominent Gulf brand may be a blast from the past for many New Yorkers. Once known as one of the Seven Sisters of the petroleum industry, Gulf was acquired by Chevron in 1984 in what was the largest combination in history at the time. To satisfy antitrust agreements, Chevron sold off some Gulf stations and converted a number of others. Few Gulf stations survived.

But a Massachusetts-based group called Gulf Oil LP acquired a license from Chevron to use the Gulf name and started a push to bring back the brand. Owned by the Haseotes family, which separately owns the Cumberland Farms convenience store chain, Gulf Oil LP also acquired the distribution rights for many of the Rochester, N.Y., area's lame-duck Exxon franchises, Jim Finn, who owns a formerly-Exxon-now-Gulf station in Macedon, Wayne County, told the paper.

When the local stations lost the Exxon logo, the familiarity with Gulf's distribution network undoubtedly played a role in many of the owners' decision to convert to the Gulf brand, said the report. "We had a choice of whatever fuel we wanted to sell, and after reviewing them all we decided that Gulf was the best situation," Finn said. "We can offer quality fuel at a lower or competitive cost."

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