Key Takeaways from The Car Wash Show
Sam Scanlan of Baird’s Multi-Unit, Restaurant & Franchising team and Ryan Smith of Baird’s Vehicle Technology & Mobility team recently attended The Car Wash Show™ in Las Vegas. Throughout the conference, Baird connected with car wash owners and operators and industry leaders to discuss the latest trends in the market. Keep reading for our key takeaways from this industry event.
The Car Wash Show Highlights
Overall Market Themes
- Membership model growth continues to be strong with mid-teens growth YoY.
- Customer churn remains flat and stable at around 7.0%
- Multi-Car / Family Plans are more widely adopted in the industry and demonstrate long average membership than individual plans
- The membership model is still in the early stages and underpenetrated relative to other consumer monthly subscription models
Strategic Site Selection
- Developers are shifting away from the “land grab” mentality and adopting a “sniper’s approach” to site selection and meticulously analyzing demographics, competition, zoning and infrastructure to ensure long-term viability and ROI. The shift reflects a maturing market where thoughtful planning outweighs rapid expansion.
New Locations Strategies
- Renovations and Adaptive Reuse – The market is seeing a resurgence as suppliers are introducing modular systems suitable for retrofitting older facilities. The strategy allows for faster market entry, reduced permitting hurdles and cost savings, which is critical given the increased cost of greenfields.
- Rise of Mini Tunnels – Locations are deploying more compact express car washes ranging from 40 to 60 feet to cater to urban areas with limited space, offering lower startup costs and quicker construction timelines. Some models can process up to 50 cars per hour, making them a viable alternative to traditional full-sized tunnels.
Tariff Implications
- Unlike many other sectors and sub-verticals, car wash operators feel well insulated from the recent developments on tariffs and expect minimal impact if anything from modest inflation.
Emphasis on Sustainability
- Sustainability continues to be a core industry theme, with innovations in water reclamation, eco-friendly detergents and energy-efficient equipment. The industry is responding to environmental concerns and regulatory pressures by adopting practices that reduce water usage and chemical runoff, aligning with consumer demand for greener services.
Technological Advancements
- The integration of advanced technologies is transforming car wash operations. Key innovations include:
- AI-Powered Management Systems - Utilizing artificial intelligence to optimize workflows, predict maintenance needs and manage staffing efficiently.
- Advanced Sensor Technology - Employing high-resolution cameras and lidar for precise vehicle detection, enabling customized wash programs that enhance efficiency and reduce resource consumption.
- License Plate Recognition - Streamlining customer identification and service customization, improving the overall customer experience.
To discuss these themes and how they may impact your business or future strategy, connect with a member of our team.
