Thai gas station operator PTG Energy is retooling operations with the anticipated spread of electric vehicles, increasing coffee shops under its umbrella fivefold over the next three years and boosting the ratio of non-oil businesses in gross profit to 50%.
PTG operates PunThai Coffee, known for its brown elephant logo and allowing customers to choose the level of bean roast when ordering coffee.
The company has doubled the number of PunThai locations every year since opening in 2012, reaching about 1,000 stores in April. It plans to open 400 stores this year and around 1,000 a year from 2025 onwards, with the goal of reaching 5,000 by 2027, Executive Vice President Sukwasa Pooshutvanitshakul told Nikkei in an interview.
PunThai uses beans from northern Thailand at all of its locations. "Our products have a high reputation for quality worldwide," Sukwasa said. Its prices are affordable, with an Americano costing 60 baht ($1.64), less than half the price at Starbucks.
More than 50% of the chain's new openings are attached to PTG fuel retailing stations, but it also has stores in commercial facilities.
Established in 1988, PTG primarily operates 2,300 gas stations nationwide and engages in fuel-related businesses including liquefied petroleum gas. Consolidated sales for the year ended December totaled 198.8 billion baht, making it the third-largest company in the Thai oil industry after PTT and Bangchak.
The company is turning its attention to cafes out of concern that sustainable growth from an oil-based business model will be difficult.
The Thai government plans to raise the proportion of EV production to 30% of all automobiles by 2030. "If domestic consumers switch from gasoline-powered cars to EVs, our gas station business will not be able to survive," Sukwasa said.
Amid intensifying competition, the gas station industry is reorganizing. By January, U.S. oil major Chevron had sold its oil retail business in Thailand to major refiner Star Petroleum Refining for 5.5 billion baht.
PTG's non-oil businesses currently account for just over 20% of gross profit, but the company aims to increase the ratio to 50% by 2027. The oil business, which currently accounts for 80%, will be reduced to 50% as the company shifts to earning money through the food and beverage and retail businesses.
PTG's concentration on cafes is also influenced by Thailand's unique roads. The country has one of the most well-developed highway systems in Southeast Asia, but there are relatively few service areas. Fuel stations serve as an alternative, usually providing their own parking lots and restaurants, with convenience stores nearby.
Other Thai gas station chains are also adopting the cafe strategy. "Over the past 10 years, as the number of car owners has increased, gas stations have become more important as rest facilities," said Junichiro Haseba, executive vice president of consulting firm SBCS.
PTT subsidiary Cafe Amazon is Thailand's largest cafe chain, operating roughly 4,600 stores at home and overseas, with plans to open more than 300 this year. Bangchak operates over 1,000 cafes under the Inthanin brand.
Although some global cafe chains have set up shop in Thailand, store numbers are far behind gas station companies. Starbucks has just under 500 stores.
"Global cafe chains have strong bargaining power in matters such as rent due to their brand power," said a finance source familiar with the food and beverage industry.
Commercial facilities able to host such cafes are concentrated in urban areas where there are plenty of customers, so there is a limit to how many locations the companies can open.
PTG is hoping to differentiate itself in a bid to catch up to leader Cafe Amazon. Sukwasa sees membership cards that can be used at the company's gas stations and at PunThai, with features like up to 10 half-priced drinks per month, as the key to attracting customers.
Original article Thai gas station chain PTG focuses on cafes amid EV shift - Nikkei Asia
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