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SALZBURG, Austria-- German discount retailer, Aldi entered the fuel retailing market for the first time by opening three service stations in the Austrian town of Salzburg, offering heavily discounted fuel, according to a Datamonitor report.
With a strong brand image and efficient business model, Aldi is likely to extend its petrol retailing presence across Austria and Europe, and may soon pose a challenge to the more established industry players, the report stated.
In its first few days of opening, the discounter sold fuel at almost half of the average regional price, causing competing service stations to slash their prices, possibly breaking EU competition laws banning the sale of fuel under cost price, according to Datamonitor.
Aldi's new service stations, managed by Free Energy, are located on the border to attract Austrian and German motorists alike, and due to lower fuel taxes in Austria and neighboring countries on the German border, there has long been a trend of German motorists crossing the border to refuel, the report stated.
If the trial in Salzburg is a success, Aldi would find itself well placed to rollout a service station offering in Austria. Unlike some other European countries, Austria's fuel market does not feature a supermarket with a significant market share. Its major players are the traditional brands of BP, OMV, Shell and Jet, with a combined volume share of more than 65 percent, according to Datamonitor.
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