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Future trends in service station retail 2016: Identifying future market trends and how fuel retailers can prepare for them

Future trends in service station retail 2016: Identifying future market trends and how fuel retailers can prepare for them

Summary

Despite the majority of European countries recovering from the 2008 economic recession (with the exception of Greece), major fuel retailers have continued to divest their retail networks over the last five years. Major fuel retailers such as TOTAL and Shell have divested their networks in the UK and Italy respectively as fuel volumes declined due to rising fuel prices which encouraged motorists to use public transport more frequently.

The initial drop in prices in 2014 caused a surge in fuel volumes as motorists were more able to afford to use their vehicles more frequently, having been forced over the previous five years to reduce their drive time and increasingly use public transport to lower transport costs. In 2015 volumes declined as motorists began to acclimatise to the new price point and went back to their old fuelling habits which caused a drop in fuel volumes, despite further declines in fuel prices over this period.

It has identified six major trends that will significantly affect the service station market over the next fifteen years and beyond -

  • Electric vehicles: Electric vehicles will have a significant effect on the forecourt over the next fifteen years. Long recharge times and a need to maintain current vehicle throughput levels will cause fuel retailers to completely redesign the forecourt to accommodate the growing number of electric vehicles on the market by 2030.
  • Fuel cell vehicles: Fuel cell vehicles will have minimal effect on the refuelling process and with the exception of making space for hydrogen storage tanks allow retailers to keep current forecourt designs, while also investing in new services such as coffee shops and restaurants to differentiate a site. In order to increase the number of fuel cell vehicles on the road, fuel retailers need to invest significantly in hydrogen pump stations as the current network of sites is extremely limited across Europe (57 locations). Gradually building up a network of hydrogen fuel pumps will help to promote fuel cell vehicles and ensure that fuel retailers meet customer needs, boosting fuel volumes as this vehicle type grows in popularity towards 2030 as over 70,000 will be produced annually from 2027.
  • Connected vehicles: Connected vehicles will allow fuel retailers to interact with motorists in real time and create loyalty which will help to boost site revenues. While motorists’ main influencing factor when selecting a service station is currently price and location, the connected vehicle will make earning loyalty points and rewarding customers easier by combining it with in vehicle payment systems.
  • New services and partnerships will meet the changing needs of motorists over the next fifteen years. As electric vehicles grow in popularity, fuel retailers’ competition will change from other fuel retailers to all retailers. Offering new on-site services such as restaurants, fast food, retail outlets, coffee shops and arcades will help innovative fuel retailers to compete against traditional retailers and shopping centres which will offer these services on a larger scale. Alternatively by creating partnerships to integrate refuelling stations at major supermarkets and shopping centres, fuel retailers can create new refuelling locations without the need to expand their services.
  • Pump Technologies: Future pump technologies will link automatically with connected vehicles to speed up the refuelling process and the introduction of automated refuelling pumps will boost vehicle throughput per site. While future technologies will enable motorists to pay faster and more simplistically from inside their vehicles, at the same time, shop sales will decline and retailers will lose the ability to advertise products at the pumps as motorists opt to remain in their vehicles.
  • Autonomous vehicles: Autonomous vehicles will take the act of driving away from motorists and allow them to travel in comfort without concerning themselves with the road. This new behaviour will also influence the refuelling process as motorists will be able to remain in their vehicles while refuelling takes place, eliminating the need to create loyalty with them as the vehicle chooses where to refuel and also reduces non fuel revenues per site.
The report Future trends in service station retail 2016 provides in-depth analysis about major trends affect the service station market and analyses the potential commercial benefits and drawbacks. Also, identifies new and upcoming forecourt technologies and provides actionable recommendations that can help fuel retailers to plan future strategies.

Companies mentioned in this report: Shell, Hyundai, Tesla, Honda, Toyota, Esso, Texaco, Tesco, BP.

Scope
  • Electric Vehicles -The demand for electric vehicles is growing and this brings with it issues for fuel retailers as these vehicles have the potential to change the whole refuelling process and cause a significant decline in service stations across the globe as vehicle throughput declines.
  • Fuel Cell Vehicles- Fuel cell vehicles will become increasingly popular as motorists move away from fossil fuel vehicles towards 2030, bringing opportunities for retailers as a new market opens.
  • Connected Vehicles- Advances in in-vehicle technologies will bring motorists and fuel retailers’ closer together, providing marketing and loyalty opportunities for fuel retailers.
  • Services & Partnerships - As the purpose of the service station begins to change and competition intensifies, fuel retailers will need to provide new innovative types of services and create new retail partnerships to appeal to motorists and compete against new competitors.
  • Pump Technology - New technologies for payment and marketing at the pumps will bring significant opportunities to boost fuel revenues and speed up the refuelling process as technologies continue to advance.
  • Autonomous and Semi-autonomous Vehicles - Autonomous vehicles will change how motorists refuel and bring a whole new challenge for fuel retailers as focus shifts from motorists to manufacturers, as motorists become increasingly disengaged from the driving process.
Reasons to buy
  • This report is an essential resource for service station retailers big and small looking to increase the productivity and attractiveness of their proposition to motorists across the globe by understanding future key trends which will affect fuel retailers at the forecourt over the next ten years and beyond.


  • Overview
    • Executive Summary
  • Fuel Market in 2016
    • More than 3,500 service stations have closed in Europe since 2010
    • Fuel volumes increased by 3.8% in 2014 as wholesale prices dropped
    • Fuel retailers turned to additional services to maintain profit margins
    • Recessionary habits are hard to break as motorists continue to focus on price
    • Fuel retailers use multiple strategies to reduce fuel prices
    • Retailers invest in new payment technologies
    • The service station forecourt 2016
    • Design and features of the average forecourt 2016
  • Future Fuel Market Trends
    • GlobalData has identified six major trends that will affect the future of the fuel market
  • Electric Vehicles
    • Electric Vehicles: motorists are increasingly purchasing electric vehicles but chicken and egg issues halt growth
    • Electric Vehicles - EV national incentives across Europe
    • Electric Vehicles - Implications for fuel retailers
    • Electric Vehicles - Recommendations
    • Forecourt of the future- The Electric Vehicle Forecourt
  • Fuel Cell Vehicles
    • Fuel cell vehicles
    • Fuel Cell Vehicles - Limited refuelling network will hinder the uptake of the fuel cell vehicle
    • Fuel Cell Vehicles - Implications for fuel retailers
    • Fuel Cell Vehicles - Recommendations
    • Forecourt of the future- The Hydrogen Vehicle Forecourt
  • The connected vehicle
    • Connected vehicles
    • Connected Vehicles - the connected vehicle gives fuel retailers an opportunity to directly market to motorists in their vehicle
    • Connected Vehicles - Implications for fuel retailers
    • Electric Vehicles - Implications for fuel retailers
    • Connected Vehicles - Recommendations
    • Forecourt of the future- The Connected Vehicle Forecourt
  • New Services and Partnerships
    • Services and Partnerships - The purpose of the forecourt is continuing to move away from purely fuel
    • Services and Partnerships - mini supermarkets have helped service stations become a place not just to refuel a vehicle
    • Services and Partnerships - Implications for fuel retailers
    • Services and Partnerships- Recommendations
    • Forecourt of the future - The Services and Partnership Forecourt
  • Pump Tech
    • Pump Technology - New pump technologies have increased vehicle throughput per site
    • Pump Technology - pay at the pump facilities have become the fourth most important factor for motorists
    • Pump Technology- Implications for fuel retailers
    • Pump Technology - Recommendations
    • Forecourt of the future - The Pump Technology Forecourt
  • Autonomous vehicles
    • Autonomous vehicles - There are a number of hurdles autonomous vehicles must jump over before mainstream adoption
    • Autonomous Vehicles - the development of autonomous vehicles will take five stages over the next fifteen years
    • Autonomous Vehicles - Implications for fuel retailers
    • Autonomous Vehicles - Recommendations
    • Forecourt of the future - the Autonomous Vehicle Forecourt
  • Key Recommendations

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