“I don’t know about selling at a loss.” Don’t see any ignorance on the part of Philippe Crevel, economist and president of the Cercle de l’Epargne. Just a little elementary-level reminder of what capitalism is supposed to be: “We sell to make money, not to lose it. This is nonsense. Selling at a loss always ends up being offset elsewhere, whether in the price of gasoline later, or through higher margins on other products.”
Three sentences, and less than a minute watch in hand. Enough for the specialist to almost bury the government’s new idea against the increase in the price of gasoline. “A communication stunt without effectiveness,” he concludes. On Sunday, the Prime Minister mentioned in The Parisian the idea of authorizing distributors to sell at cost, and even at a loss. An initiative confirmed by the Minister of the Economy, Bruno le Maire, this Monday. He announced the start of operations on December 2, for six months. That’s it for the details. But the hardest part remains: convincing people that it’s a good idea.
A “surprising” and short-term decision
It will undoubtedly take more than an agenda, as the skepticism of economic players seems great. Even among our Belgian neighbors, where we never miss the opportunity to criticize an incongruous French decision. Bernard Keppenne, economic head of CBC Banque on site, considers “the decision very surprising” by its very principle. “It can only work in the very short term. A few weeks. But it is untenable over several long months. However, there is no indication that the price of a barrel of oil will fall.”
This is the second complaint that Bernard Keppenne points out: granting such a free pass to fossil fuels “goes against the government’s logic of reducing our greenhouse gas emissions”. On September 11, a week ago to the day, Emmanuel Macron judged the G20 climate resolutions “insufficient” and called for strengthening efforts to move away from fossil fuels.
Quite relative efficiency
Finally, “if selling at a loss is not usually authorized, it is for a reason”, underlines Philippe Crevel: the distortion of competition. This is the problem that this measure poses, “it creates a huge injustice between small independent pump attendants and large supermarkets, who have much more margin to amortize the price of gasoline – or even who can more easily pass it on elsewhere “. An advantage for the Goliaths against the Davids “which could cause heavy damage for the latter”. Especially “since this disadvantage goes against the Territorial Planning law, which promised to watch over the self-employed,” adds Philippe Crevel.
The competitive disadvantage of these small pump attendants has another negative effect on the French wallet. Sylvain Bersinger, economist at Asterès: “The margins of pump attendants are low, around 2 cents per liter of fuel. Even if they sold slightly at a loss, the gain would only be a few cents per liter (for motorists) at best. This possibility therefore does not seem to be able to significantly increase the purchasing power of households. » With one more nuance: “Such a sale at a loss is, however, unlikely without compensation from the State. »
Same observation at Philippe Crevel: “If the government really wanted to act on the price of gasoline, it would have had to take real measures: a reduction in taxes, an energy check, a reduction in VAT…” New consensus among experts contacted. Between the energy transition and the strategy put in place by the countries of the Organization of the Petroleum Exporting Countries, we will have to get used to the price of gasoline being high. And the pain felt when going to the pump.