Chevron Corp. said Friday that it would buy most of the gasoline stations owned by USA Petroleum Corp., the California independent retailer believed to have invented self-service fueling in the 1940s.
Privately owned USA Petroleum, based in Thousand Oaks, plans to sell 122 of its 160 stations -- amounting to nearly all of its California network, USA Petroleum President Mark Conant said. All but a handful of the affected stations sell fuel under the USA name.
The sale would eliminate California's largest chain of service stations not affiliated with a major oil company or refiner. Conant said the stations were owned by USA and would be owned by Chevron when the deal was complete.
USA would retain 38 stations across the country, including a few California sites in Imperial Valley and other areas not served by Chevron, Conant said.
Consumer advocacy groups have long complained that California's small contingent of unbranded independents makes the state's market less competitive. Charles Langley of the San Diego-based Utility Consumers' Action Network said the deal between Chevron and USA would make matters worse.
"It's very troubling to see Chevron, which already has a huge market share, getting bigger," Langley said. "We need more competition, not less."
Chevron and BP's Arco brand are the two largest gasoline retailers in California. San Ramon, Calif.-based Chevron said its Texaco and Chevron-branded outlets make up 1,500 of California's 10,000 service stations.
For long periods during the last two years, price breaks at the pump were rare among independent sellers. Hindered by wildly fluctuating wholesale gasoline markets in Los Angeles and San Francisco, the unbranded bunch frequently found themselves buying fuel at prices well above the going retail rate. To limit losses, they posted higher pump prices than their branded competitors.
But USA Petroleum's Conant said that was not a factor in the company's decision to shed stations.
"We've been able to make money every year," he said. He added that owner John Moller, 65, is just "taking some of the chips off the table."
Moller said that the time was right for a sale.
"After nearly 50 years, I believe it is appropriate to sell some of our retail gas station holdings, and I believe that the transition to Chevron also will be good for my customers and station employees," Moller said in a statement.
The first self-service gasoline station was opened in 1947 by independent marketer George Urich, according to the book "American Service Station: History and Folklore of Gas Stations in America." USA Petroleum subsequently bought Urich's stations.
Chevron's purchase of USA Petroleum's gas stations is subject to approval by the Federal Trade Commission.