16 Aug 2010

Shell accused of fair trading breach over petrol ad

5:23 pm on 16 August 2010

A series of advertisements claiming a Shell petrol formulation was designed to help consumers travel further has come under scrutiny in the Wellington District Court.

Shell is defending 22 charges laid by the Commerce Commission under the Fair Trading Act.

The advertising campaign, run in 2006, featured footage of a ski jumper soaring over a village with the words "designed to take you further".

The Commerce Commission says the advertising was misleading because it gave the impression that consumers could travel appreciably further when using Shell's Fuel Economy Formula, when in reality they could not.

The commission says the formula gave, at best, an average benefit of less than 1%. That meant if an average car travelled 650 kilometres on a tank of petrol a motorist would get six kilometres further using the Shell formula.

Marketing lecturer Sara-Jane Todd told the court on Monday consumers viewing the ads would have believed it would make an appreciable difference to the distance they could drive on a tank of petrol.

Professor Todd said while the amount might be significant to a fuel engineer, the ordinary consumer would expect more than a 0.98% average improvement.

Shell's lawyer questioned research done by Professor Todd, suggesting the statement "designed to take you further" was perfectly true.

The case is set down for four days.