Teboil’s rivals do not now appear to be interested in purchasing the service stations that are being boycotted.
the Ukraine Lukoil, which owns Teboil, may have to decide whether it is no longer profitable to conduct business in Finland while the battle goes on.
Since Russia invaded Ukraine in late February, Teboil has been the target of a significant boycott. The boycott’s goal is to make the business activities of Russian oil company Lukoil more challenging. A Lukoil subsidiary in Finland is called Oy Teboil Ab.
Some Teboil business owners have decided against continuing their activities in light of the Russian onslaught, and as a result, some have ended their agreement with the service station network. Additionally, a number of Finnish organizations have stopped working with Teboil.
Tuesday saw Yle once more citing a substantial decline in fuel sales at Teboil service stations as a result of the boycott.
In Finland, Teboil operates 208 automatic and 112 manual service stations. Teboil is currently seeking an entrepreneur for 19 sites. Teboil also offers 217 diesel vending units for use by business vehicles.
Toni Flycktin, vice president of marketing and communications at Teboil, was contacted by HS, but she declined to grant an interview.
Because of the unusual nature of the scenario, Flyck added, “These are things we don’t want to comment on.”
According to prior statements made by Fled, the company does not import any gasoline or diesel from Russia instead sourcing its fuel from Neste in Porvoo and Western Europe. The Lukoil connection may cause customers to avoid Teboil’s service stations more frequently even if the sanctions against Russia have no direct effect on the company’s operations.
If the current geopolitical difficulties last for a while and a peaceful resolution to the situation in Ukraine is not found soon, Lukoil might even contemplate leaving the Finnish market and selling Teboil’s activities. In the background debate of HS, a well-known professional in the field expressed this viewpoint.
If customer flows decline as the company’s profitability deteriorates, exiting the market may be necessary. If sanctions against Russia are extended and, for example, money transfers to Russia become more challenging, the operation of a Russian-owned firm in Finland may also become more challenging.
For instance, Lukoil has already sold its gas stations and station networks in the Baltic nations, even completely abandoning the market.
Teboil has a substantial market share, particularly in diesel marketed to trucks. The refrigeration stations and truck diesel stations owned by Teboil can be traded to other Finnish distribution firms.
stations teboil According to a gas station and oil specialist, selling to rivals would be challenging in reality due to competition legislation. Laitinen Hannu Laitinen has previously held executive positions with organizations such as the Finnish Energy Cooperative (SEO) and the Finnish Petrol Dealers’ Association, among others. She has also written various papers on the service station industry.
The fuel market in Finland is already highly consolidated. More than 90% of the market is under the hands of the top four competitors, ABC, Neste, St1, and Teboil.
“It would be a really tough scenario if any market participant acquired or divested its market shares, or even if one of the four main firms went out totally,” adds Laitinen.
Making such agreements would be more difficult. It should essentially be a new gambler entering the market.
Market participants are prohibited from maintaining a permanent market share of greater than 30% under EU competition laws. The competition authority has, however, permitted acquisitions in the industry in the twenty-first century.
Competitors of Teboilin are unlikely to be interested in purchasing petrol stations.
Following the liquid, Inderes analyst Petri Gostowski thinks it’s quite improbable that Neste would want to buy Teboil. Gostwoskik also brings up aspects of competition law that could have an impact on trade.
“Neste already holds a sizable market share in the retail sector thanks to its own chain network. Additionally, they have a distinct growth plan that is centered on the refinement of renewable products, according to Gostowski.
Juha Vanninen, the manager of St1’s sales and network, declines to say whether St1 would be interested in buying Teboil’s service stations.
“The laws governing competition are very strict in Finland, and market shares are quickly acquired. I’m at a loss for speculation at this time. Before this is discussed, the seller should also be ready to sell, according to him.
Teboil Finnish business owners who own and operate petrol stations under the Teboil brand have been particularly badly hit by the boycott.
While some business owners own their own homes, Teboil is the landlord for the majority of the businesses.
Teboil’s decision to sell or lease its service station properties to a neutral operator is one way to help the situation for business owners.
For instance, Neste sold a portion of its holdings related to gas stations to a global investment firm in 2006. Prior to that, Neste controlled the assets through a subsidiary it owned on its own, and it leased the space to Kesko Food, which in the deal became a tenant of the new owner.
Such fixes have been developed in the past. If Teboil gave up its qualities, there would be nothing new in it. According to Laitinen, this may be a temporary or permanent solution.