Asda co-owner Mohsin Issa declined to answer MPs repeated questions over whether Asda had upped its fuel margin target, as he insisted that the supermarket’s pricing strategy “has not changed” since the billionaire brothers bought the business.
Speaking at the Business and Trade Committee today (19 July), Issa concurred with Asda chief commerical officer Kris Comerford’s previous comments at a hearing in June, arguing “the pricing strategy has not changed, we remain the price leader in fuel”.
MPs described the session as “drawing teeth” as they accused Issa of failing to answer questions on not just fuel but the supermarket’s financing and its treatment of staff.
The Competition and Markets Authority (CMA) found that UK drivers who bought fuel at supermarkets in 2022 paid approximately 6 pence per litre more than they would have done due to the ‘big four’ supermarkets increasing their margins.
The CMA blamed the weakening competition on a decision by Asda and Morrisons to compete less so as to achieve higher margins, and a lack of competitive response to this by others.
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During the investigation, the competition watchdog found that betwen January 2019 and December 2021, Asda was the cheapest supermarket for petrol in 89% of weeks during the period, and the cheapest for diesel across 94%.
However, between January and May 2022, this declined 76% for petrol and 70% for diesel.
Issa’s response remained that the supermarkets strategy “did not change” and said this was caused by “market volatility”.
Earlier this month, the CMA issued two £30,000 fines to Asda for “sending a representative to attend a compulsory CMA interview who was not equipped to provide evidence on certain topics” and “failing to respond completely to a compulsory written request for information”.
When also questioned over why Asda did not comply with the CMA’s enquiry, Issa stated that the information requested “simply does not exist in our business today and we did not know that at the time”.
