Gas prices drive many stations out of business

The Boston Globe reports:

Add to amateur stock car racers, pleasure boaters, taxi drivers, and workaday commuters a new group suffering from high gas prices: those selling the stuff at more than $4 a gallon.
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Dozens of gas stations in Massachusetts have stopped selling gas or shut down, and hundreds more are expected to follow suit because rising costs coupled with crippling credit card fees and fewer customers make it impossible for them to afford the roughly $40,000 it costs to refill their underground tanks, according to the New England Service Station and Repair Association.

"We just couldn't compete anymore," said Chip McAllister, who earlier this month reached the breaking point and shut off the pumps at the North Andover gas station he and his wife, Carol, opened in 1988. The couple said that they were losing $5,000 a month on gas and that it was time to focus on their auto repair business instead. They laid off two attendants and retrained a third to perform auto inspections.

The problem lies in large part with credit cards, industry officials say. Gas stations customarily mark up the price by 8 to 12 cents per gallon, no matter the market conditions. But credit card companies charge a fee of 2 percent to 3 percent per sale. So as the price-per-gallon increases, the gas stations pay a larger share of their profits to credit companies.