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Posted on Sun, Jan 31, 2010 : 6:04 a.m.

Ann Arbor-area gas station closings stem from U.S. sales drop

By Paula Gardner


The ex-Marathon station at Packard and Platt in Ann Arbor closed in December.

Angela Cesere |

Drivers on the east side of Ann Arbor once waited in lines to buy discounted gas at the Washtenaw Mini Mart, the Marathon station next to Arborland Mall.

Then, for a few days in December, signs on pumps advertised that credit card machines wouldn’t work.

And just before Christmas, the station closed. So did the station at the northeast corner of Packard and Platt. And by early January, the Citgo on East Stadium posted signs that it no longer was selling gas.

That left many in the region wondering: What’s going on with local gas stations?

The Ann Arbor area is witnessing fallout from changes in the petroleum industry as consumption drops, experts said.

 “The gas business has changed,” said Robert Calmus, corporate spokesperson for Marathon Oil Corp.

The oil company, based in Houston, is warning investors that its fourth quarter results will show a drop in gross profit margin for wholesale sales from 1.25 cents per gallon to 1 cent per gallon.

That scenario is playing out at other oil companies and their distributors across the U.S., as forecasts called for a 6.9 percent drop in consumption from 2007 levels through the end of 2009.

In Michigan, “sales are down 17 percent from where they were in 2004,” said Mark Griffin, president of the Michigan Petroleum Association.

“The volume isn’t there anymore,” Griffin said. “(Station owners) don’t make money selling gasoline.”

As a result, Griffin said, the number of gas stations is shrinking across the state, while most successful operators seek to expand sales in adjacent convenience stores or carry-out restaurants.

Among the closed gas stations in Washtenaw County:
• 3555 Washtenaw in Ann Arbor, the former Marathon by Arborland, now in foreclosure.
• 4025 Packard at Carpenter in Pittsfield Township, a former Marathon station that was closed when the property owners repositioned it as a development property. It may soon be leased to a new operator.
• 3005 Packard, a former Marathon at the corner of Platt that closed after property owner Randa Hourani filed for bankruptcy.
• 1166 Ecorse Road in Ypsilanti, a former BP station, now part of a court-ordered sale.
• 4005 Washtenaw at Carpenter in Pittsfield Township, a former Mobil station reportedly caught in a partnership dispute.

Meanwhile, the Citgo station at 1500 E. Stadium at Packard stopped selling gas earlier this month. Employees who lease the adjacent service station say it was an issue between the owners and the payment structure with the distributor. Last week, new management took over the station, reactivated gas sales and is rebranding it under Marathon.

Some of the changes don’t involve closings.

The Citgo at 2955 Packard, for example, is seeking city approval to expand its retail space.

And the Shell station at 3240 Washtenaw at Huron Parkway has city approval to demolish the existing building and rebuild it to include a Tim Horton’s outlet. Gas sales will be a feature of the new station, developer Leo Gonzales of CRS in Plymouth said.

Few “big oil” companies now own retail outlets, Griffin said. Marathon, for example, does not directly own or operate the area’s closed stations, Calmus said.


John Mendler in the garage of his Marathon station at the Jackson/Dexter split in Ann Arbor. Mendler says the retail gas industry is changing, but his station is stable.

Lon Horwedel |

John Mendler, owner of Mallek’s Service Station at 1500 Jackson Ave., says his independent Marathon station continues to be profitable amid the industry changes. He pays by the tank when gasoline is delivered, leaving him without a contracted sales volume that he needs to target.

“I’m in an unusual situation. The way that I sell gas is not like most places,” he said. “I’m essentially (paying) load to load.”

And while he chose years ago not to pursue an expanded convenience store, his adjacent repair business still drives much of his business.

At stations for sale, some of the sales volume is down 40 percent, said Larry Gotcher, a commercial real estate agent at Keller Williams Ann Arbor with two stations listed in Michigan.

“But they’re still making money,” he said.

Buyers continue to look at the stations. Some, Gotcher said, are first-time buyers, while others seek to add to a portfolio.

He predicts more changes among operators and gas stations in the region.

So does Griffin, who says the ongoing economic climate in Michigan keeps affecting the industry.

“With the economy being what it is, it’s very difficult to make money in this business,” Griffin said. “It’s very competitive. But there are still a lot of gas stations out there. They’re just all chasing after 17 percent less sales.”

Paula Gardner is Business Director at Contact her at 734-623-2586.



Fri, Jul 9, 2010 : 7:50 p.m.

Does anyone know what's being built to take the place by Arborland for that Marathan station....there's no sign saying what it is!


Mon, Feb 1, 2010 : 2:35 p.m.

Why do we need a gas station on every corner? They all seem to carry the same price for gas so there is no real competition. I believe that there are way too many gas stations even today. Since most of them don't do car repair, they compete directly with convenience and grocery stores for food and stuff, and they are usually way over priced.

John Galt

Mon, Feb 1, 2010 : 12:20 p.m.

As fewer people are communting to work each day (with unemployment around 10 percent locally), fewer gallons of gas and therefore customers are available for the stations. Just another sign of the collapse in the economy.


Mon, Feb 1, 2010 : 12:01 p.m.

Paula, The paper version of has had the jump-to page incorrect in articles at least 2 Sundays in a row - in section A, no less. I, for one, am sad to see Lowell's Marathon (on Washtenaw) go. That has been there forever. :(

Old Salt

Mon, Feb 1, 2010 : 12:12 a.m.

This means there will be more ugly empty buildings in Ann Arbor,just what we needed,we have enough already. Maybe the City of AA will buy them and plant a few nice trees, flowers and and grass.


Sun, Jan 31, 2010 : 10:29 p.m.

Its interesting to note that with consumption down so much that a bunch of stations are going out of business, the price of gas is still way up there. Must be all our bailout money speculating on gas futures.


Sun, Jan 31, 2010 : 6:02 p.m.

Thanks, it really is no problem. I leafed through and didn't find it the first time. Thank you for locating it for me.

Paula Gardner

Sun, Jan 31, 2010 : 3:14 p.m.

goodthoughts, Thanks for coming online to finish the story! I just leafed through my print edition and found the rest of the story on page 4, not page 10 as it says on the front page. Not sure what happened, but on behalf of, I apologize for the inconvenience.


Sun, Jan 31, 2010 : 12:49 p.m.

I was actually reading this story in my home-delivered version and had to come online to read the remainder. At the end of the paper version it said "see GAS A10" and A10 only had the rest of the train article. Where did it go?


Sun, Jan 31, 2010 : 7:41 a.m.

I'm not sure that one fits into the point of this story. The station on that corner and the old Shell station kiddy corner across the street were closed by the corporations that ran them so the land could be developed. The Shell site has been in the process for years and the old Marathon site sits waiting for an improved economy.