Why Is Arco Gas Cheaper? (The Reasons Explained!)

When you go to any gas station to refuel your car engine, you will always notice a common thing. You will find that Arco gas is cheaper than other gases. Yes, Arco gas has made a reputation for being one of the cheapest gases always and remains at the bottom of the gas prices despite many ups and downs.

So, why is Arco gas cheaper than most gases in the gas stations?

This is a good question since many people think that Arco supplies bad-quality gas, so they can feed vehicles with cheaper gas. But that’s not true.

Two basic reasons help Arco to sell their gas cheaply. Arco supplies cheaper gas since they don’t allow payment in credit cards and offer discounts due to their 2X more sales than an average gas station.

Nonetheless, due to Arco’s cheap pricing, many people think their gas is inferior. So, they ask, “Is Arco gas good for my vehicle?” We will also find its answer here.

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What Is Arco Gas?

Arco started their business as an oil company in 1966. However, their ownership has changed recently, which most people don’t know.

Presently Marathon Petroleum and Tesoro Corporation own Arco gas stations. They bought it from BP in 2018 and 2012, respectively. Their partnership has the following agreements-

  • Tesoro Corporation owns the company in Washington, Northern California, and Oregon.
  • Marathon Petroleum has the ownership in the other parts of America and Mexico to use the brand commercially.

So, Arco is actually owned by two top gasoline sellers in the US. Also, they maintain an excellent business policy to lower their gas price without compromising the quality.

How Does Gas Stations Gas Pricing Work?

Since Arco gas station also follows the fundamentals of any standard gas station, it is important to understand its pricing basics. It will help you know how Arco can afford to sell gas at a lower price than most gas stations.

Except for Arco, other gas stations heavily rely on credit cards for bill payments from their customers. As customers pay bills on credit cards, these gas stations need to pay the processing fee for each of these credit card transactions.

The average credit card transaction fee is $.30 in the US. It means for each payment; gas stations need to pay additional 30 cents. It adds up to their gas pricing, and so, you will mostly find these gas stations selling their gas at a higher price to minimize the credit card transaction fee.

Also, an average gas station will accept debit cards without any additional fees. So, it also adds up to their overall cost.

And right at this point, Arco gets a clear edge over these gas stations’ business policy and can sell gas at a lower price. The following discussion will help you know how Arco manages its billing and is ready to offer a lower price for their gases almost always.

Why Is Arco Gas Cheaper? The Reasons Explained

Arco has come up with an innovative business policy that will surprise you. Actually, this excellent business policy allows them to sell gas at a lower price irrespective of the market condition.

In fact, Arco gas is almost $0.05 to $.15 cheaper per gallon than an average gas station. At first glance, it may not seem a substantial difference. A four-wheeler may need 2 to 4 gallons of gas for every 100 miles of the journey.

That being said, if you use Arco gas for 1000 miles of the journey, you will almost save $5 to $10. Isn’t it amazing?

So, how does Arco manages to save such a big amount in their gas selling? The answer is pretty simple-

  1. Arco doesn’t allow payments on credit cards, and so they save money on credit card transaction fees.
  2. An average Arco gas station has almost 2X more sales than the regular stations. They use the massive selling for their lower pricing.

Now, explain the two points elaborately.

1. No use of credit cards

No use of credit cards

Arco doesn’t take any paymentson credit cards. When you visit an Arco gas station for car refueling, you must pay them in cash.

This is crucial since other gas stations need to pay around $0.30 for each transaction on the credit card. They will charge this additional fee to customers, and it boosts the gas price. For instance, if you buy 2 gallons of gas from a regular station and pay it in credit cards, you will have to pay an extra $0.15 for each gallon.

That’s where Arco excels in from others. Since they don’t use any credit card and deals with hard cash, they can immediately offer you gas at a $0.10 to $0.15 discount rate. In other words, they save money from not accepting credit cards and pay the savings back to their pockets.

2. Discount from their extra sales

Discount from their extra sales

Another point that helps Arco sell gas ata lower price is their massive sale compared to any reputed gas stations in the US. It includes their policy in accepting debit cards.

When you pay your bills with debit cards in Arco gas station, they will charge you an extra $0.45 for each transaction. Since customers know that they will need to pay this extra amount for debit card payments, most customers buy more gas than a usual car owner.

For instance, if you buy 10 gallons of gas from Arco and pay it with debit cards, you need to pay $0.45 for the bills. But if you buy 5 gallons, you still have to pay the extra $0.45 as part of the debit card bill processing. So, customers prefer buying more to minimize their debit card charges in Arco stations.

It helps Arco sell more gas than an average gas station. In fact, it helps Arco so much so that it has, in reality, 2X more sales than other gas stations.

Since they may profit more in this massive sales boost, they pay a portion to customers through discounts. It also allows them to keep the gas pricing lower most times.

However, many people think that Arco gas is bad for their vehicles, and so, Arco sells gas ata much lower price.

But is it true? Let’s look at the matter closely.

Is Arco Good For Vehicles?

The lower pricing of Arco gas has come with two contradicting facts. These are-

  1. Due to lower pricing, many people love using Arco gas in their automobiles
  2. Other people think that Arco is bad gas for their cars and so, it allures customers with low price.

But this isn’t true. In fact, most customers reviewed that Arco gas is quite good, if not better than other gas brands in the US.

Previously Arco used cheaper gas in its station. It led to a massive debate, and many car owners started avoiding Arco for this reason. But the company was fast to recognize its decline in sales and soon shifted to ‘Top Tier’ gas.

Top Tier gas refers to those gasoline fuels that seven automobile manufacturers recommend using for their vehicles. It has a higher quality and so is ideal for cars. The good news is Arco maintains the top-tier gas requirements as part of its business standards.

You will, in fact, find Arco’s top-tier gas similar to those sold by BP, Amoco, Shell, Costco, etc., gas stations across the USA.

Top-tier gas comes with some unique benefits. It includes-

  1. Top-tier gas comes with a self-cleansing effect in the vehicles. Studies have found that over a 5000 miles or driving period, top-tier gas can reduce the debris and deposit buildup by 72%. So, you will need less maintenance of the fuel intake valve and prolong the engine lifespan. So, it is a great way to lower your automobile maintenance bills greatly.
  2. Top-tier gas also enhances your drivability with the vehicles. So, you will love how it boosts your driving experience.

So, it is safe to say that Arco gas is good for your cars. Also, you must understand that being an American company, Arco has to meet the minimum gas requirements as stated by Federal and State laws.

The federal authority has strict laws for gasoline, and all gas stations must maintain the guideline strictly. Arco is no exception to it, so their gas also meets the minimum requirements set by the Federal government. So, you can depend on Arco’s gasoline for quality without any doubt.

Conclusion

Arco gas company don’t use credit cards as payment gateway. Also, they sell 2X more gas than the other companies. So, they can use their savings from not using credit cards and profits to supply the gas at a lower price in the gas stations.

Also, their gas quality is as good as any top brands in the US, if not better. So, you can use Arco gas for their cars confidently.

Who Worked on This?

Rafayel

Editor

I'm the guy responsible for ensuring that every blog post we publish is helpful for our reader.

Baron

Writer

I'm the guy responsible for ensuring honest, informative, accurate and helpful guide to the reader.

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