Gas Station
Overview
A gas station is a commercial facility that supplies fuel such as gasoline, diesel, kerosene, and LPG to vehicles and machinery using internal combustion engines, including cars, motorcycles, and ships. Typically located in accessible areas such as roadsides, major intersections, and highway rest stops, gas stations have evolved into complex facilities offering various additional services like car washes, repairs, convenience stores, and cafes beyond fuel sales. As the final point of contact in the petroleum product distribution network from refining to consumers, gas stations are considered essential infrastructure directly linked to national energy security and daily life.
Main Content
History and Development
The first gas station is recorded to have appeared in 1905 in St. Louis, Missouri, USA. At that time, gasoline was sold by directly scooping it from drums in pharmacies or hardware stores. The era of dedicated gas stations began in 1913 with the opening of the first drive-in gas station in Pittsburgh, Pennsylvania. In Korea, the first gas station appeared in Gyeongseong-bu (Seoul) in the 1910s, and their numbers rapidly increased during the economic growth and expansion of automobile ownership in the 1960s and 1970s.
Operational Structure and Distribution
Gas stations are broadly classified into oil refinery direct-operated stations, dealerships, and individually owned businesses. Refineries (such as SK Energy, GS Caltex, Hyundai Oilbank, and S-OIL) operate stations under their own brands or expand their networks through franchise agreements. The distribution process follows: crude oil import → refining → logistics (storage tanks, tanker trucks) → gas station → consumer. The margin for gas stations arises from the difference between the refinery supply price and the consumer selling price, but profitability is declining due to intensified competition and increased price transparency.
Price Determinants
The price of gasoline at gas stations is influenced by a combination of factors: international crude oil prices (Dubai crude, Brent crude), exchange rates, refinery supply prices, taxes (transportation, energy, and environment tax, education tax, driving tax, value-added tax), distribution costs, and the gas station's own margin. Korea has a relatively high proportion of taxes in gasoline prices among OECD countries, with taxes accounting for over 50% of the consumer price. The government implements policies such as fuel tax cuts and tariff adjustments to stabilize oil prices.
Additional Services and Complexification
Modern gas stations offer a variety of services beyond simple fuel sales. Key additional services include car washes (automatic and manual), engine oil changes, tire pressure checks, vehicle repairs, convenience stores (in partnership with CU, GS25, etc.), cafes, ATMs, and electric vehicle charging stations. Particularly, gas stations in suburban areas or highway rest stops have developed into large-scale complex rest areas with restaurants, shower facilities, and lounges.
Safety and Environmental Regulations
Gas stations, as facilities handling flammable materials, are subject to strict safety regulations. In Korea, laws such as the 'Dangerous Materials Safety Management Act', 'Petroleum and Alternative Fuel Business Act', and 'Firefighting Facilities Act' apply. Key safety measures include explosion-proof electrical equipment, vapor recovery systems, double-walled tanks, leak detection systems, and fire suppression equipment. Environmentally, issues such as air pollution from vapor emissions and groundwater contamination (from storage tank leaks) have been consistently raised, and the government is implementing regulations such as mandatory replacement of old tanks and enhanced vapor recovery rates.
Competition with Electric Vehicle Charging Stations
The expansion of electric vehicles poses a significant threat to the gas station industry. Electric vehicles have lower maintenance costs than internal combustion engine vehicles and can be charged at home or work, reducing the frequency of visits to gas stations. Consequently, many gas stations are installing additional electric vehicle chargers, and some are even converting entirely into charging stations. The Korean government is pursuing a policy to mandate the installation of fast chargers at highway rest stops and major urban gas stations nationwide by 2025.
Latest Trends
As of 2024–2025, the gas station industry is undergoing the following changes:
- Expansion of Electric Vehicle Charging Infrastructure: Approximately 15% of gas stations nationwide operate electric vehicle chargers, and this proportion is rapidly increasing due to government subsidies and mandatory installation policies.
- Increase in Unmanned Gas Stations: To reduce labor costs and enable 24-hour operation, more gas stations are adopting unmanned payment systems (self-service). As of 2024, about 40% of all gas stations have converted to self-service.
- Integration with Hydrogen Charging Stations: In line with the expansion of hydrogen vehicles, some large gas stations are increasingly co-locating hydrogen charging stations.
- Digital Transformation: The adoption of mobile app-based fuel discounts, demand forecasting using big data, and AI-based inventory management systems is spreading.
- Introduction of Eco-friendly Fuels: Sales of biodiesel and bioethanol blended fuels have begun at some gas stations, and their share is expected to increase under carbon neutrality policies.
- Industry Restructuring: Due to low margins, the shift to electric vehicles, and stricter regulations, closures of small independent gas stations are increasing, and the industry is being reorganized around large refinery direct-operated stations and complex gas stations.
Related Topics
- [[Petroleum refining]]
- [[Electric vehicle charging station]]
- [[Fuel tax]]
- [[Automotive fuel]]
- [[Energy infrastructure]]
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