Exxon Mobile MasterCard Review
Review of ExxonMobil Credit Card
Rebate Formula - The ExxonMobil credit card pays a rebate of 15 cents for every gallon of gasoline that you purchase from Exxon or Mobil stations. You will earn 2% rebates for every dollar that you spend up to $10,000 (for non Exxon gasoline purchases) and 1% rebates once your expenditure exceeds $10,000. Rebates gets automatically credited towards your next purchases and are valid for six billing cycles.
Annual Fee and APR - The Exxonmobil credit card has no annual fee. The apr is prime rate plus 5.99% for the platinum mastercard version and prime rate plus 9.99% for the normal mastercard. The Exxonmobil credit card uses the average daily balance method (including new purchases) to compute balances. New cardholders get a 0% introductory apr for balance transfers for six months from the date of the first balance transfer. You are allowed six months to transfer your balances and there is no balance transfer fee during the introductory period.
Other Card Features - The ExxonMobil Mastercard has several features like allowing you to pay your Exxon Mobil credit card payments online. You can also check the history of your Exxon Mobil credit card account online for the last six months.
ExxonMobil MasterCard Break Even Analysis
Due to the nature of the rebate formula, which is a fixed amount and not percentage, I though it is good to start looking at some raw calcalations as to at what price of gasoline to do you earn a certain rebate.
Break Even for 2% - To earn 2% rebates, the price of gasoline has to be $7.50. OK - so that is an easy hurdle to meet.
Break Even for 3% - To earn 3% rebates, the price of gasoline has to be $5.00.
Break Even for 4% - To earn 4% rebates, gasoline prices have to be $3.75.
Break Even for 5% - To earn 5% rebates, gas prices have to be $3.00.
ExxonMobil MasterCard Peer Comparison
ExxonMobil vs Chevron Texaco - The closest comparison that we can make is with the Chevron Texaco Card. That is because Chevron uses the same formula as ExxonMobil. But instead of paying 15 cents rebates per gallon of gasoline purchased, the Chevron card only pays 10 cents. So clearly, the ExxonMobil beats the Chevron card. The other advantage that this card has (and which no other card has) is that you can earn 2% rebates on non-ExxonMobil gas purchases for the first $10,000 in spending. Once you exceed $10,000 in in spending, you earn 1% rebates. That means that for regular purchases, you can earn 2% rebates (which is quite unheard of with the exceptions of very few cards that have come and gone).
ExxonMobil vs Other Gas Station Cards - Unlike Exxon and Chevron, all other gas station cards pay a fixe rebate percentage on gasoline spending rather than a fixed amount per gallon. So a real apples to apples comparion is not feasible. What we can say is that the better cards like Shell, Marathon and BP offer 5% rebates. Lukoil and Speedway offer 4% rebates while Hess and Gulf offer 3%. So 3% seems to be the minimum or floor for these cards. But the Exxon card has something which these other cards do not offer. And that is you can earn 2% rebates on other regular purchases for the first $10,000 in spending for non-exxon gas purchases.
ExxonMobil vs All Station Gas Rebate Cards - Once again, it is very difficult to compare this card with regular cash back cards. The rebates that you can earn range from 2% to 5%. In the 2% camp, there are cards like the Discover OPEN Road Card and the Blue Cash EveryDay. In the 3% camp, you have the Costco credit card. In the 4% area, you have the Costco business card. In the 5% camp, you have the PenFed VISA Platinum Gas / Cash Rewards Card.
Once again, the ExxonMobil Card gives you the ability to earn 2% rebates on regular purchases for up to the first $10,000 in spending. No other cards have this feature today. However, the cards that we have just mentioned allow you to earn 2% to 3% on certain categories with no spending caps. The Blue Cash Everyday for example, allows you to earn 3% on groceries and 2% on department store spending. The Costco card lets you earn 2% on dining and travel expenses. PenFed allows you to earn 2% on groceries.
ExxonMobil MasterCard - How Does It Stack Up?
Pros - Allows you to earn 2% rebates on regular purchases for the first $10,000 in annual spend.
Cons - Rebate formula is based on fixed amount per gallon and not percentages. Therefore, you earn more rebates only when prices of gasoline fall (which runs counter intuitive to how we think - since we want to earn more rebates when gas prices rise!).
Verdict - The Exxonmobil credit card will appeal to those who use Exxon or Mobil stations frequently. However, I do not like the rebate formula at all. It is structured such that you only earn more rebates (in percentage terms) when gas prices fall. This is the opposite of what we want. We want to earn more rebates because gas prices are rising. Hence, I would suggest getting other cards like the TrueEarnings® Business Card from Costco and American Express, which pays 5% rebates on gas at ANY station, 3% at restaurants and 2% on travel items, and 1% on regular purchases or the PenFed VISA Platinum Gas / Cash Rewards Card, which pays 5% on gasoline and 2% on groceries. At least with these cards, you know that you are getting a fixed percentage in rebates regardless of gasoline prices.