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Petrochemicals

Orlen retail division keeps losing market share

Polish motorists are increasingly avoiding gas stations run by the country?s no. 1 refinery, publicly traded PKN Orlen because of the prices charged by Płock-based petrochemical giant. Orlen retail division sold less gasoline than last year, senior company executive wrote in an internal memo recently. Marek Bakuła, the head of Orlen logistical devision stated that retail sales in early April were 12 percent below target.

Gasoline prices at Orlen, which had 28.6 percent market share at the end of December, down from more than 35 percent at the end of 2002, rose 27 times since January. The company lowered its prices 19 times in less than four months.

Industry sources say Orlen is losing market share to Western gas station chains and hypermarket gas stations, which are usually cheaper.

PKN Orlen has 1900 gas stations across the country. Almost 40 percent of its 30 billion zloty in sales last year came from retail sales. Operating income at the retail division totaled barely 49 million zloty, or 1.7 percent of the total.