WASCO, Calif. (KERO) — With the introduction of a new gas station in Wasco, we speak to an economist about the impact of Walmart in rural areas and a Wasco gas station owner about the change to the area.
- New gas station at Walmart in Wasco has led to lower gas prices in the area.
- Local gas station owners like Ghassan Ahmed are struggling to compete with Walmart's prices.
- Economics professor Dr. Aaron Hegde suggests that Walmart aims to attract customers to both its gas station and store.
- The long-term impact on smaller gas stations and the overall local economy remains uncertain.
- Residents benefit from lower prices, but it may hurt smaller businesses.
For your convenience, the skimmable summary above is generated with the assistance of AI and fact checked by our team prior to publication. Read the full story as originally reported below.
Broadcast transcript:
If you've been through Wasco, you've likely seen a new place to fill up your tank. I'm Sam Hoyle, your neighborhood reporter, and one person in the Wasco Chismosos Facebook group asked since the opening prices around town have gone down, were residents getting ripped off before?
"That is similar to whether it's a Costco or Sam's Club or any of these other discount retailers, same thing is to bring people for the gas and then hopefully they'll buy other things where they may have a higher margin."
That's Dr. Aaron Hegde, an economic professor at CSUB, and his take on the opening of the new gas station at Wasco's Walmart is a tale as old as time. Provide a service, so consumers will take advantage of your other services.
"If they're already there at Walmart, or if they're at the gas station, then they can go into Walmart to pick up something. So that definitely will increase for traffic, both to Walmart and to the gas station. And if it increased more, more folks are going to the gas station instead of somewhere else, then the smaller gas stations in town might be adversely impacted."
Which gets us to the question: how has this affected local competition? Is it better for the consumer by lowering prices and increasing availability, or will it lead to the local providers being pushed out?
"It's affecting very bad," said Ghassan Ahmed.
Ghassan Ahmed tells us he's been the owner of Wasco Gas on Highway 46 for over a decade, but with the introduction of new competition, Ahmed says he's had to adjust prices accordingly.
"We are not making any money right now. We're losing money because I trying to keep customers at my locations. If I have maybe five cents higher than Walmart, I will not have no customers here at all," said Ahmed.
"It's really not a guarantee that having this gas station will increase foot traffic to Walmart. It probably will, but whether how much it increases is worth the gas station or not, I'm sure Walmart has done those calculations, and they feel that that might be profitable for them," said Hegde.
However, looking to the future, Hegde says it's still too early to tell what the introduction of the new station will mean for the entirety of Wasco, residents, and businesses alike.
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