Summarised by Centrist
Auckland motorists have seen petrol prices plunge to $2.12 a litre, as a price war erupts around U-GO – a no-frills, self-service petrol brand rolled out across the city.
With average prices for 91 octane hovering near $2.51, the steep discount has triggered competitive cuts from rivals like Mobil.
But experts say the low prices are unlikely to last, and the competition may not be what it seems.
U-GO stations, currently operating at nine Auckland sites, are offering fuel well below market rates. Terry Collins from the Automobile Association likened it to supermarkets using “loss leaders” to lure customers, saying prices under $2.20 are welcome but unsustainable.
What most consumers don’t realise is that U-GO is not a new player – it’s owned and operated by Z Energy. Former Caltex sites are being converted into U-GO stations, allowing Z to expand its market share while targeting cost-conscious drivers under a different banner.
Editor’s Note: The U-GO rollout is market consolidation disguised as disruptive competition. Z Energy, one of New Zealand’s largest fuel retailers, now controls multiple brands at different price points: Z for premium, U-GO for discount. This dual-brand strategy creates the illusion of choice while allowing one corporate owner to dominate both ends of the pricing spectrum.
Independent retailers like NPD, Gull and Allied, lack the scale to match sustained low-price campaigns. In the short term, drivers win on price. In the long term, fewer truly independent fuel options may remain.
