Business

Gas war rages near Highway 100

New Fleet Farm, Casey's, Kwik Star and Hy-Vee compete

A sign showing the price for super unleaded gasoline is seen at the Fleet Farm gas station, 4650 Cross Pointe Blvd. NE, on Wednesday morning. (Jim Slosiarek/The Gazette)
A sign showing the price for super unleaded gasoline is seen at the Fleet Farm gas station, 4650 Cross Pointe Blvd. NE, on Wednesday morning. (Jim Slosiarek/The Gazette)
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CEDAR RAPIDS — An old-fashioned neighborhood gasoline price war continues where Cedar Rapids and Hiawatha meet at Edgewood Road NE and Blairs Ferry NE, with two new retailers and established convenience stores selling fuel at a sharp discount.

Appleton, Wis.-based Fleet Farm, 4650 Cross Pointe Blvd. NE, ignited the competition when it opened Sept. 20 selling mid-grade gasoline for $2.05 per gallon, roughly 40 cents less per gallon than other stations near that intersection.

La Crosse, Wis.-based Kwik Star quickly matched the $2.05 per gallon at its convenience store that opened the previous day nearby at 300 Blairs Ferry Rd. NE.

After some initial delay, Casey’s General Stores, 5555 Edgewood Rd. NE and just north of Fleet Farm, lowered the price of mid-grade gasoline to match Fleet Farm and Kwik Star.

By Monday, all three retailers were selling mid-grade fuel for about $2.25 per gallon. The Hy-Vee Convenience Store around the corner at 3935 Blairs Ferry Rd. NE also matched its competitors.

Fleet Farm has a reputation in some markets for undercutting the fuel prices of its competitors. The opening of a Fleet Farm store in Mankato, Minn., was the catalyst for a fuel price war that gas stations and convenience stores fought from April through mid-July 2016.

Fleet Farm and Sam’s Club of Bentonville. Ark., agreed to each pay a $40,000 penalty in 2016 after they were ordered by the state of Minnesota to stop selling gasoline at substantially lower prices than smaller competitors.

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The penalty was reduced to $20,000 each if the companies stayed in compliance with Minnesota’s fuel pricing law.

The law is intended to keep large fuel sellers from offering fuel at extremely low prices to drive smaller competitors out of the market.

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