It's 100% true. My uncle owns a fairly large gas/service station. The profit from gas sales effectively paid the rent for the service station. He paid all of his employees (and himself) with money coming from the car repair business. The gas pumps were irrelevant to his own profit, but required a lot of hassle/wasted time.

About 2 or 3 years ago he bought a larger building, hired more mechanics, and didn't build gas pumps. They're just not worth the hassle.

For perspective, the credit card companies made more money per gallon than he did as the gas station owner.

I don't know if there are citations, but there is a very well known trend in the retail gas industry of 0% margin on the fuel, and 100% of the profit coming from the mini-store.

I have a friend who runs about a dozen gas stations in the bay area, and they literally change the price for each tanker of gas that comes in - the pricing is so dynamic - and they get charged based on the neighborhood/market that they are in. Her goal is to not lose any money on gas sales, and make it all up in the store.

A family friend owned a gas station, and pricing was so competitive in the ~1million people city he lived in, he said that the one or two drive-offs he had per week cut his profits to zero. He was shocked that stores can offer 2-10cents per liter discount.

He sold up last year.

The original quote is true, but he misphrased it.

The convenience store attached to a gas station is very profitable (huge markups on cheap food) but has relatively little revenue. The gasoline is not very profitable (razor thin margins due to competing with, essentially, everyone) but brings in a lot of revenue. (Every customer at a gas station buys gas)

The convenience store is the most profitable part, but that doesn't mean you can get rid of the gas pumps and just sell five dollar bottles of Coke.