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Big Differences In Gas Prices Between Nashville And Suburbs

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Posted at 6:34 PM, Aug 17, 2015
and last updated 2015-09-08 04:46:39-04

MURFREESBORO, Tenn. - Customers at Dodge's on Northwest Broad Street in Murfreesboro are paying some of the cheapest prices for gas in the mid-state. But that is not the case in Nashville.

You can purchase a gallon of regular gas for $2.10 with cash at Dodge's. Leroy Bradley stopped by Monday to fill-up.

"$2.12, $2.10, $2.16, something like that. It's not too bad. I mean, if you're going to do any traveling, now is the time to do it, prices are really pretty good," Bradley said.

But when he visits his daughter who lives in Nashville, he is always amazed by how much a gallon of gas costs.

"I look at the gas prices here, and it's only 35 mile difference, but like you said, 2.70, 2.78. I don't understand, what's the difference," questioned Bradley.

At the Exxon station on Shelby Avenue the price of a gallon of regular gas was $2.59 Monday afternoon. 

Lipscomb University professor Andy Borchers said there are several issues that factor into the wide difference in prices between the city and the suburbs.

"One of the reasons is, it's certainly more expensive to operate a gasoline station in a major city; higher land cost, higher labor costs," Borchers explained. "Those are real factors there. But there's also a question of the composition of the market, and the willingness people have to pay more for convenience, for example."

The professor also said companies make very little money on the sale of gasoline. Many times in the suburbs there are multiple gas stations next to each other, and they are trying to entice customers to pull up to their pumps.

"Gas price lower, draws in people, they buy coffee, or soft drinks, or other things that are profitable for them to operate,' Borchers said.

The price of gas in Tennessee is low compared to the rest of the nation. The average for a price for a gallon of regular gas this past weekend was $2.29. The national average is $2.66. The price of gas is about $1.00 less than it was a year ago this week when the average was $3.22.