Is Reg Owned By Chevron?

Reg is a well-known gas station and convenience store chain in the Western United States. With over 500 locations, Reg has become a ubiquitous presence for drivers looking to fuel up or grab a quick bite. Despite its popularity, there has been some confusion over Reg’s ownership and relationship with oil giant Chevron.

Chevron is one of the world’s largest integrated energy companies, with operations spanning oil and gas exploration, production, refining, marketing and more. Chevron-branded gas stations dot roadways across the U.S. and beyond.

While the two brands often appear side-by-side, and share some similarities, Reg is an entirely separate company from Chevron. Understanding the history and operations of each provides clarity on any perceived connection between the two.

Reg’s Origins

Reg was founded in 1981 in Des Moines, Iowa by Bill Krause and Richard Hartley. Krause had experience managing gas stations, while Hartley brought financial expertise to the table. Together, they spotted an opportunity to build a chain of gas stations in Iowa focused on exceptional customer service and community engagement.

Reg began with a small number of stations in the Des Moines area. Krause and Hartley worked hard to make each location stand out through clean facilities, friendly staff, and little perks like free coffee and window washing. This formula quickly made Reg a favorite fuel stop for many Iowa residents.

Through the 1980s, Reg grew steadily by acquiring underperforming gas stations and upgrades them to the Reg brand. The company remained rooted in Iowa but expanded across the state. Reg became known for having a strong connection to local communities, supporting everything from little league teams to charity car washes.

By the late 1990s, Reg had over 100 locations in Iowa and a reputation for excellent customer service. The company’s origins as a homegrown Iowa business was a key part of its identity. Reg continued expanding within Iowa in the following decades.

Reg’s Business Model

Reg operates gas stations using a franchise business model. Individual Reg gas stations are independently owned and operated by local franchisees. This helps Reg build a large national presence while allowing local owners to run their own businesses.

According to the Retail Gas Station as a Profitable Business Model article, “The franchise model helps entrepreneurs open their own stations faster under a proven brand.” Reg provides franchisees with branding, supply agreements, and corporate support while franchisees handle local operations, marketing, and community engagement.

The typical Reg franchisee owns and operates multiple station locations within their geographic territory. The franchise model allows Reg to scale rapidly across the US without requiring massive corporate overhead. Reg also benefits from motivated local owners who have a stake in making their individual stations successful.

As the SIA Partners article mentions, the franchise model provides more flexibility than direct corporate ownership of retail fuel stations. Reg can evolve its brand and offerings more fluidly across thousands of franchised locations. This helps Reg continually improve the customer experience and perceive value as consumer demands change.

Chevron’s Profile

Chevron is one of the world’s largest integrated energy companies and one of the largest publicly traded companies in the United States, based on market capitalization. Chevron explores for, produces, and transports crude oil and natural gas; refines, markets, and distributes transportation fuels and lubricants; manufactures and sells petrochemical products; generates power; and develops and deploys technologies that enhance business value in every aspect of the company’s operations.

Chevron has significant global operations across six continents – Africa, Asia, Australia/Oceania, Europe, North America and South America. The company produces oil three miles beneath the ocean surface, and is the fourth-largest refiner in the United States. Chevron also operates one of the world’s largest integrated renewable power businesses. With its assets located in over 180 countries, Chevron is one of the world’s largest integrated energy companies, employing over 48,000 people worldwide.

Source: Chevron company background images – Depositphotos

Chevron’s Gas Stations

Chevron Corporation owns and leases gas stations that operate under the Chevron and Texaco brands. According to Chevron’s website, the company has over 8,000 Chevron and Texaco branded gas stations in the U.S. (https://www.chevronwithtechron.com/en_us/home/station-ownership.html). These stations sell fuel like gasoline, diesel and biodiesel under the Chevron brand name. Many of the stations also feature convenience stores or auto repair services.

While Chevron owns some gas stations directly, many are owned or leased by independent businesses. These station owners and lessees have agreements with Chevron to sell fuel and use the Chevron branding. So while the stations sell Chevron’s products and use its name, they are operated by individual owners and franchisees.

Relationship Between Reg and Chevron

Despite the similarity in branding, Reg was an independent company from Chevron until 2022. Reg gas stations were supplied by Chevron but independently owned and operated [1]. Reg built its stations next to Chevron to capitalize on Chevron’s strong brand recognition, but Reg’s ownership, management, and operations remained entirely separate.

This independent model allowed Reg to establish its own retail pricing strategy. While Reg benefited from Chevron’s supply chain and brand reputation, Reg stations competed with Chevron stations on fuel pricing and service offerings. Customers often assumed Reg was owned by Chevron because of the similar branding, but that was not the case prior to 2022.

Reg’s Growth Strategy

One of the keys to Reg’s rapid expansion across the United States has been its franchising model. Reg does not actually own most of the gas stations that bear its name. Instead, Reg makes deals with individual entrepreneurs and investors to open up Reg-branded gas stations in communities across the country.

Reg provides the branding, logos, and gas supply to these franchisees, who pay fees and royalties back to Reg. This allows Reg to grow quickly without having to put up all the capital costs to build and operate each new gas station itself.

The franchising model has fueled Reg’s growth from just a handful of stations in the 1960s to over 5,000 today across the continental U.S. It has allowed Reg to establish a national footprint and brand recognition without taking on all the risks and costs of being the sole owner-operator.

Confusion About Ownership

Renewable Energy Group, Inc. (REG) is an established company in the biofuels space that has been operating since 1996, but the Reg brand is much less widely known by consumers compared to major oil and gas companies like Chevron. ^[1] Chevron is one of the largest integrated energy companies in the world and owns thousands of gas stations across the U.S., including Chevron and Texaco branded stations. ^[2] By contrast, Reg does not operate any consumer-facing gas stations.

Since the Reg brand is not a household name like Chevron, many consumers are unfamiliar with the company. This lack of brand recognition for Reg has led some to mistakenly assume Reg is owned by Chevron since they acquired the company in 2022. However, Reg continues to operate as an independent subsidiary under the ownership of Chevron.

While Chevron now owns Reg, the Reg brand maintains its distinct renewable fuel identity and independent operations. Reg production plants, research facilities, and corporate headquarters all remain fully intact after the acquisition. The Reg brand itself will continue forward as well. This structure can create confusion since Reg has its own separate brand identity, yet is owned by the much larger and more well-known oil company Chevron.

Clearing Up the Misconception

Despite some confusion, Reg is not owned or operated by Chevron [1]. Reg began in 1996 as an independent company focused on biodiesel production and distribution. It expanded over the years into one of the largest producers and marketers of biodiesel and renewable diesel in the United States. Reg has its own leadership team, board of directors, manufacturing facilities, and distribution infrastructure.

In 2022, Chevron announced an agreement to acquire Reg in an all-cash transaction [2]. This led to some incorrect assumptions that Reg was already owned by Chevron. However, the acquisition was only completed in June 2022. So prior to that, Reg operated fully independently of Chevron.

The Reg brand still exists as a wholly-owned subsidiary of Chevron. But it continues to manufacture and market its renewable fuels using the same business model and management. Chevron acquired Reg to become a leading renewable fuel company, not to change Reg’s operations [3]. So while Reg is now owned by Chevron, it still operates as an independent renewable fuel company.

Conclusion

In summary, Renewable Energy Group (Reg) is an independent business that is not owned by Chevron. Reg was founded in 1996 and went public in 2012, operating as an independent biodiesel production company. While Chevron and Reg have a business partnership, Reg maintains its own operations, manufacturing facilities, management, and strategy. The two companies formed a strategic alliance in 2014 for co-branding and fuel sales, but Reg has remained a separate entity. Despite recent acquisition rumors, Reg continues to run autonomously with its own growth plans focused on being a leading producer of renewable fuels. While Reg supplies Chevron and other fuel marketers with its products, it is not a Chevron-owned brand. Reg’s independence is a core part of its business model and operations.