It’s a new year, a year we had hoped would take us past the scourge of the pandemic and back to the way we were in 2019. Alas, it looks like that is not to be. As this column is being prepared, there are still 10 days left on the 2021 calendar. The latest COVID-19 reporting is all about the highly transmissible omicron variant that has become the dominant variant in the United States and the likelihood that it will remain so well into 2022. Already certain jurisdictions are imposing new restrictions, restaurants are closing, and some workers are being encouraged to work from home.
The market has taken note and is spooked. Today, the Dow closed down 433 points — about 1.23 percent. It looked a little darker earlier in the day when the Dow was down 699. As is often the case, there was some rapid recovery as the closing bell drew closer. It’s best not to follow these daily fluctuations too closely. Where will the market be tomorrow when this column is set for copy editing, or later this week when this issue is sent to the printer? The market experienced a similar nasty drop when the omicron variant was first identified in South Africa — and recovered.
Despite the ongoing pandemic and the sea of uncertainty it creates, the car wash industry is forging ahead undeterred.
Consolidation is continuing apace with acquisitions growing in numbers and in size. Just last month, Mister Car Wash added 33 locations in Florida to its holdings — in a single transaction. As Jeff Pavone, partner at Amplify Car Wash Advisors, so succinctly put it: “We can sum up the industry in one word: hot.”
That applies to more than just the M&A business. The results of our State of the Industry survey of vendors to the car wash industry (Auto Laundry News December 2021) reveal a group of thriving and confident businesses. Overall, 61 percent reported year-over-year sales growth. An impressive 100 percent in the equipment manufacturer subcategory reported gains. Looking to the future, 75 percent of respondents, overall, projected sales growth in 2022. Equipment manufacturers again stood out, with 100 percent of this group projecting increased sales.
Detailers, too, are looking at improved circumstances. As reported in our Detailing Survey (page 31 in this issue), detailers have made a strong recovery from the poor performance recorded during the COVID-driven restrictive months of 2020. In this year’s survey, 53 percent of respondents reported improvement in their business year-over-year compared to 19 percent who were able to do so one year ago. One might argue that is easy to make advances from a particularly down year such as that brought about by the pandemic. However, this is also the first time in four years that a majority of respondents, overall, reported gains.
The car wash industry has thus far come through the pandemic relatively unscathed. In fact, one might say it is flourishing. But the virus is still with us. It probably will be, in some form or another, for the foreseeable future. It will continue to impact commerce and our day-to-day lives. There will also be other issues and challenges to face. In his article on page 18 of this issue, Robert Roman compiles a list the factors that affect the sustainable profitability of a car wash. “Arguably,” he writes, “the resilience of the car wash industry will be further tested into 2022.”