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Everyone loves Costco, right? They treat their employees much better than other businesses, and they have competitive prices on a wide variety of items. In fact, Costco is known for some of the lowest prices on gas and if you want to shop for gas at Costco, get a $20 Costco Shop Card for that.
But what do these low prices mean when it comes to the quality of Costco gas?
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Cheap gas, yes. But what about Costco gas quality?
Per ConsumerReports.com, warehouse gas prices are typically 5 to 25 cents less expensive (here) per gallon. However, for most consumers, low prices can often be considered a sign of low quality. This may call into question the quality of the black gold sold at Costco’s 668 gas stations.
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Since Costco sells its gasoline for much less than the competition, it’s natural to be skeptical and wonder whether the quality is on par with brand-name gasoline like Exxon, Shell, and Chevron. Most people want to know whether Costco gas is good quality fuel, or whether it could cause long-term damage to their fuel system.
There are two reasons why Costco’s gas is less expensive. First, Costco does a better job with controlling prices in its gasoline business than most of its competitors. In general Costco’s SG&A (selling, general and administrative) costs are less than Walmart and Target (here). This means they can afford to keep prices low. Second, Costco’s business philosophy is to provide high quality goods at competitive prices. So, this means that in order to keep its business growing, Costco needs to sell its gasoline at lower prices than the competition in order to get people to come to its warehouse stores (according to their 2022 annual report). ).
But what about Costco’s gas quality?
gas quality standards
First, it’s important to note that the Environmental Protection Agency (EPA) sets stringent standards for all gasoline sold in the United States (per 40 CFR Part 1090). When it comes to octane level and other specific gasoline characteristics, all gas is basically the same. The difference between the fuel you buy at branded gas stations is due to the detergent added to the gas.
Even in the case of detergents, the government sets standards. The federal government has required since 1995 that all gasoline sold in the US must contain a certain amount of detergent additives. These additives are EPA approved, and the amount of detergent must be regulated to keep vehicle engines free of deposits. Costco gasoline meets all of these requirements, despite being so much cheaper than nearby stations. Just because you’re saving money, doesn’t mean they’ve dropped or given up on any rules.
Is Costco Gas As Good As The Competitors?
So, Costco meets the minimum requirements, but is it still as good as other brand-name gasoline?
Many automakers decided that the US government’s additive requirement was not sufficient for many cars. As a result, they developed a “top tier” standard. To meet the “top tier” designation, the fuel sold at a gas station must meet additional requirements as required by the US government. Costco fuel meets this top-tier standard.
While Costco’s gas isn’t the same as other brands, that doesn’t make it a lesser product. After all, if it was the same exact gas, Costco wouldn’t be able to differentiate itself. Costco gasoline is practically on par with any other major brand gasoline. You shouldn’t notice any difference when filling up your vehicle at Costco, just like any other brand. The only difference you should notice is a much milder hit on the wallet.
Get Better Gas Quality & Save Money
If you’re not sure Costco gasoline is as good as another major brand, try this “gas hack” to save money. In most areas of the country, you can fill up at a Costco gas station, as well as add quality fuel injector cleaner.
Finally, there is nothing to suggest that Costco brand fuel is inferior to any other brand of gasoline. Don’t let the price alone stop you from filling it in there.
from around the web
If you’re interested in some funny gasoline reading, check out the story of this guy who found a way to shut down the ads at the gas pump. And, here’s a story from a guy who earned $900 using the cash back gas app Upside. Best of all, he donated $900 to buy gas for some of the nurses. The story is here.
Read more from Savings Advice:
Costco Gas Calculator: Will I Save Money Buying a Membership If I Only Buy Fuel?
Getting Costco Gas? Don’t forget to check out their holiday schedule
Open Earlier and Close Later – Costco Gas Station Timings
(Photo courtesy of Adam Keyes)
Do you fill up at Costco gas stations? What do you think about the quality of gas?
james hendrickson
James Hendrickson is an internet entrepreneur, blogging junkie, hunter and personal finance enthusiast. When he’s not lurking in coffee shops in Portland, Oregon, you’ll find him in the great outdoors of the Pacific Northwest. James has a master’s degree in sociology from the University of Maryland at College Park and a bachelor’s degree in sociology from Earlham College. He loves individual stocks, bonds and precious metals.
www.dinksfinance.com
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