The Competition and Markets Authority (CMA) has fined Asda £60,000 and named Morrisons for targeting higher fuel margins, as it sets out its plan to drive down fuel prices.
The CMA issued two £30,000 fines to Asda for “sending a representative to attend a compulsory CMA interview who was not equipped to provide evidence on certain topics” and “failing to respond completely to a compulsory written request for information”.
The watchdog also found both Asda and Morrisons “each made the decision to target higher margins” on fuel sales in 2022. The report said Asda’s fuel margin in 2023 was more than three times what it was in 2019, while Morrisons doubled its target margin over the same period.
The CMA said Tesco and Sainsbury’s “did not respond in the way you would expect in a competitive market” and raised prices in line with their competitors.
As a result of the supermarkets targeting increased fuel margins, the CMA said drivers paid an extra 6p per litre.
Despite its findings, the authority said it found “no evidence to suggest that there has been cartel behaviour taking place” among the supermarkets and it has “no plans to open an enforcement case”.
To drive down the price of fuel, the CMA suggested making it compulsory for supermarkets to share data and called for the launching of a new “fuel monitor” oversight body.
CMA chief executive Sarah Cardell said: “Competition at the pump is not working as well as it should be and something needs to change swiftly to address this. Drivers buying fuel at supermarkets in 2022 have paid around 6 pence per litre more than they would have done otherwise, due to the four major supermarkets increasing their margins. This will have a greater impact on vulnerable people, particularly those in areas with less choice of fuel stations.
“We need to reignite competition among fuel retailers and that means two things. It needs to be easier for drivers to compare up-to-date prices so retailers have to compete harder for their business. This is why we are recommending the UK government legislate for a new fuel finder scheme, which would make it compulsory for retailers to make their prices available in real-time. This would end the need to drive around and look at the prices displayed on the forecourt and would ideally enable live price data on satnavs and map apps.
“Given the importance of this market to millions of people across the UK, this needs to be backed by a new fuel monitor function that will hold the industry to account. As we transition to net zero, the case for ongoing monitoring of this critical market will grow even stronger, so we stand ready to work with the UK government to implement these proposals as quickly as possible.”
Darren Jones, chair of the Business and Trade Committee which grilled representatives of the traditional big four supermarkets on food and fuel prices last week, said:
“Only last week supermarket bosses told us they were not putting up petrol prices unfairly, and that they were cooperating with the competition authority.
“But this week, it’s been confirmed that competition isn’t keeping down prices in line with wholesale costs and that Asda, in particular, didn’t cooperate with the investigation.
“That is unacceptable and action must be taken.”
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