Power

The rise of on-demand fuel means the poor will inherit gas stations

Gas delivery and electric vehicles are pushing gas stations to focus on more than fuel.

Power

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Power

The rise of on-demand fuel means the poor will inherit gas stations

Gas delivery and electric vehicles are pushing gas stations to focus on more than fuel.

Philip Martin backed up his truck to the end of a driveway on a morning in March of last year. He was delivering gas for Yoshi, an on-demand fuel startup, and I was along for the ride to fill up a car in Belle Meade, on the outskirts of Nashville. Through Yoshi’s app, customers can schedule a fill-up or an oil change, even a car wash, when they’re at home or work. If this sounds ridiculous, that’s because drivers have been going to the fuel for over a century; now, it’s coming directly to them.

Martin pulled a gas hose alongside a black Mercedes-Benz SUV, and using a magnetic fuel key that Yoshi invented, he popped open the tank, inserted the nozzle, and then flipped on the pump in the bed of his truck. I had written about on-demand fuel months earlier and traveled to Nashville to see it first hand. As I expected, we filled up luxury cars at houses with white pillars and gated driveways. Yoshi membership costs $20 a month, non-members pay $7 an appointment, and the price per gallon is set according to the region’s AAA average. Customers are paying a premium for the convenience.

Ashley Levi, the owner of the SUV we were filling up that day, stepped outside her gray house and offered us coffee while Martin pumped gas. Levi, a 49-year-old homemaker, rattled off Yoshi’s benefits: she’s always late and never has to worry about gas; it’s one less stop with her three kids; she doesn’t have to touch filthy gas pump handles anymore.

Going to the gas station can be unpleasant. I know because during grad school I worked at a GetGo in Pittsburgh. Customers often argued over parking and my checkout line usually stretched the length of the store, but I’d see a student, landscaper, and doctor in succession. I rang up customers of every race and class, but soon those who want to circumvent these community hubs will have the opportunity — if they can afford it, that is.


In February, ExxonMobil and General Motors Ventures announced that each had invested in Yoshi. With Exxon and GM on Yoshi’s board, the possibility of on-demand fuel as a successful industry seems valid. And its viability should be known soon enough. Yoshi services 14 cities — Atlanta, Austin, Chicago, Cleveland, Houston, Los Angeles, Minneapolis, Nashville, the Raleigh/Durham area, San Francisco, Silicon Valley, St. Louis, Tampa Bay, and Warren, Michigan — and plans to expand to 25 by year’s end.

Based in Silicon Valley, Yoshi serves individual customers and fleets (think: rental cars or buses for a school district), and isn’t vastly different from its top competitors, Booster and Filld. Booster, which operates in the San Francisco Bay area and Dallas/Fort Worth region, is focused on filling up fleets and offering membership discounts to Fortune 500 corporations. Filld, unlike Yoshi and Booster, stays off the road during peak driving hours, which means it does night fill ups. Instead of offering membership, Filld costs between $3 and $9 a delivery, depending on time and location, and it services individual customers and fleets in the San Francisco Bay Area and Seattle. In two other markets — Portland and Vancouver — it schedules fleets only.

Bryan Frist, Yoshi co-founder and chief operations officer, is hoping to distance his company from the competition by figuring out how to profit from individual customer sales, which he referred to as the “gold nugget” that will determine which companies succeed.

The Yoshi app.

The Yoshi app.

“Density alone is the key metric,” Frist said. That was obvious during the second half of my ride along. As Martin and I reached Vanderbilt University, the stops became more frequent, and with greater density came more diversity. The luxury cars turned into Honda Civics and Chevy Cruzes. Martin said this showed on-demand fuel isn’t just an upper-class convenience. As Yoshi expands to new cities and grows its marketing team — Frist said the company relies mostly on local press and word of mouth — maybe that will be true. But many modern conveniences, from the refrigerator to the cell phone, started out by indulging the rich.

In the early 20th century, only the top 1 percent of Americans could afford automobiles. The first car owners bought gasoline in cans at general stores or filled up at curbside pumps. But buying cans meant pouring it yourself, and curbside pumps caused traffic nightmares. Gas stations were created, but the first ones were dirt lots where large steel drums were perched on wooden bases. These bulk depots were loud, foul, prone to fires and explosions, and they were operated by grimy men who huddled around scrap metal shanties. The rich didn’t want these flammable eyesores in their neighborhood.

Then, on December 1, 1913, Gulf opened the world’s first architecturally designed drive-in gas station along Baum Blvd. in Pittsburgh. Gulf’s hexagonal brick building blended into the neighborhood, fuel tanks were buried under a paved lot, and the attendants wore clean, matching uniforms. It pleased the rich and launched the industry. After World War II, when the middle class bought cars in droves, gas stations dotted highways and shaped suburbs. Pulling up to a pump, once a public display of status, became a universal experience.

Fast forward to the oil crises of the 1970s, when gas shortages were common; gas station owners began selling convenience store items, like cigarettes, potato chips, and lottery tickets, to earn a profit. Over the next two decades, convenience stores slowly took over the field, and attendants and mechanics were replaced by line cooks and cashiers.

Jeff Lenard, the vice president of strategic industry initiatives for the National Association of Convenience Stores (NACS), said this evolution won't stop and it would be a mistake to become complacent with the current business model. “Convenience, for the better part of 100 years, has revolved around how people can conveniently go to the retailer,” he said. “As the internet redefines convenience... it’s changing to the retailer going to the consumer.”

As with other delivery-based services there is some hand-wringing about how this will affect communities, and it’s worth considering. The interactions I witnessed as a GetGo cashier were brief — doors held open, tire air pumped for a stranger, exchanges in the checkout line — but they were meaningful.

In the '70s, gas stations began selling convenience store items as a way to increase revenue during gas shortages. Today many gas stations are expanding to focus on retail and dining as on-demand fueling and electric cars gain popularity.

In the '70s, gas stations began selling convenience store items as a way to increase revenue during gas shortages. Today many gas stations are expanding to focus on retail and dining as on-demand fueling and electric cars gain popularity.

However, GetGo was one of the busiest gas stations in Pittsburgh. There were four registers, and shifts where I deposited thousands of dollars into a floor safe. Frequenting a business where that kind of money is exchanged carries a certain amount of risk, and the on-demand fuel industry promotes the idea that its service is safer than filling up on your own. Technically, that’s true. You can’t get robbed at a gas station if you stay home.

Booster states on its website that 120,000 violent crimes occur at gas stations each year, and that’s not true. In 2016, according to the FBI’s uniform crime report, 7,729 violent crimes were committed against individuals at gas stations. That’s less than 1 percent of all violent crimes. Even if you add criminal acts against gas station properties, like armed robbery and theft, it still doesn’t reach half of 120,000. A Booster representative didn’t respond to multiple emails requesting comment. Yoshi had promoted the same incorrect crime statistic on its website, but removed it this spring. Filld, on the other hand, references a 2008 National Crime Victimization Survey.

Gas stations are perceived to be dangerous because whenever crime happens at highly populated community hubs it ends up on the news. In my 22 months as a GetGo cashier, the only crime I saw was a man in army fatigues barrel-roll across the counter and run out carrying cartons of Newport.

Convenience, rather than safety, draws more people to on-demand fuel, according to Kurt Hoppe, an advisory board member for the Internet of Things Consortium. As a consortium board member, he’s seen cars head toward the convenience of connectivity since 1996, when GM created the OnStar system. Connected cars have internet access and communicate with devices on a network. Hoppe said that the goal is to have cars, not customers, notify an on-demand fuel company when it needs gas.

“Most people don’t like going to the gas station,” Hoppe said. “If you’re in the deep south or Arizona, it’s too hot in the summer. If you’re in Michigan, in the winter it’s fricking cold. You don’t want to get out of your vehicle. But if you had a connected car” you wouldn’t have to.

The convenience of connected cars promises to extend beyond fuel. Car owners won’t have to worry about oil changes or tire pressure, either. Car maintenance could become a concern of the past, and on-demand fuel might act as the bridge to that reality. It may even become a necessity for some because, though the gas station industry earns $500 billion a year, they are slowly vanishing.

Since 1994, 25 percent of America’s gas stations have disappeared. Property value is the main reason for the decline. Gentrification in major cities has raised real estate prices to the point where gas station owners are selling their property to developers. San Francisco is a perfect example. As the cost of living has skyrocketed there in the past decade, 40 percent of its gas stations have vanished. This trend is going to continue because of ride sharing, automation, and fuel efficient cars, which is a reason why gas consumption is already trending downward.

Electric vehicles (EV) are possibly the greatest long-term threat to the gas station industry. Similar to the automobile’s target audience in 1913, EVs represent 1 percent of the American market today, and a best-case scenario projects that it could hit 10 percent of all new cars sales by 2025. EV owners can already charge at big-box retailers like Walmart and Target, and the more ubiquitous they become, the more charging options there will likely be.

So, gas station chains are experimenting with ways to keep customers by pushing further into retail and dining. Sheetz, one of the east coast’s biggest chains, opened a Morgantown, West Virginia location that is 15,000 square feet, has zero gas pumps, and seating for 100. Sheetz and Wawa have also begun delivering food. If Yoshi’s expansion succeeds in finding a base of individual customers, Sheetz and Wawa might be in a position to transition from food delivery into on-demand fuel.

On-demand fuel and the rise of electric cars could change the customer base of gas stations.

On-demand fuel and the rise of electric cars could change the customer base of gas stations.

Other corporations are already preparing for this likelihood. Shell launched an on-demand service in the Netherlands, and Amazon has started delivering packages directly to cars. Fuel seems like a logical next step.


At the end of my Yoshi ride-along with Philip Martin, I met Alaina Davis, a pediatric rheumatologist who uses the service in Nashville. Davis, who was eight months pregnant with her second daughter, parked her black Acadia and rushed toward the hospital. She told me that she and her husband, who is a radiologist, each work between 50 and 80 hours a week, and to maximize their free time, they outsource as many chores as possible.

“There isn’t a convenient gas station on my way home,” she said. “I would have to go out of my way after picking up the girls, and it’s usually the middle of rush hour. You always have to wait in line at the tank, and you’re fighting the traffic in and around the gas station, too. It’s easier to have my gas delivered.”

On-demand fuel might be the simplest solution. But if this startup industry takes off, while EV sales continue to increase and the number of gas stations continue to decrease, what will be the social impact? If the gas station industry evolves in a way that fails to cater to customers who subscribe to Yoshi or buy a Tesla, it seems possible that gas stations will become public spaces primarily inhabited by the working and lower classes; an ironic twist, given who the industry catered to in 1913.

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