While no one really knows what the future holds, the car wash industry today is happily floating along in a well-deserved period of growth. This has not always been the case.

Only a few years ago, the industry was trying to keep itself steady in the choppy waters of the recession. Bob Roman, a consultant with 17 years of industry experience, points out that in 1999 car wash revenues in the U.S. had reached a high of $23 billion, but by 2011 had dropped to $19.6 billion. Now, according to a 2014 ICA consumer study, 76 percent of car wash consumers choose professional washes over home washes, a number that has been steadily growing for at least two decades.

America is not the only place with a bright future. Throughout the world, regions with thriving economies are seeing an increase in drivers and vehicles on the road. For instance, a 2014 Wall Street Journal article reported that the number of licensed drivers in China would soon exceed 300 million, surpassing America’s 212 million license holders.

A similar enthusiasm for automobiles has reached the Middle East and North Africa where the number of cars on the streets is rapidly multiplying. According to global analysts Frost & Sullivan, almost 34 million passenger vehicles will be traveling the region’s roadways by 2020, 61 percent more vehicles than in 2015. As a car culture begins to take root in overseas markets, corresponding car care markets are also likely to sprout up and flourish.

Meanwhile, the European car wash industries continue to prosper, and Germany, which boasted a €1.8 billion market in 2014 according to a Verdict Trend Report, is the clear leader. This success is due to a combination of governmental regulation that prohibits home car washes coupled with the country’s deep-rooted cultural affinity for high-quality vehicles, including its homegrown BMW, Porsche and Mercedes-Benz brands.

Lower prices, increase customers

Across the globe, car wash professionals who want to make the most out of the current boom time are trying to predict the trends and troubles the industry will encounter over the next decade.

In July, at a retail petroleum and car wash industries trade fair in Stuttgart, Germany, a panel of executives from car wash equipment giants WashTec, Istobal, Kärcher and Sonax sat down to discuss the future of the European market. According to Brushtec’s website, which reported on the panel’s discussion, the executives agreed that “good price” was one of the first things European customers looked for. And American consumers are no different. In a 2014 International Carwash Association National Consumer Study, 67 percent of customers identified “price” as a leading concern when purchasing a professional wash.

Lower prices are linked to another trend sweeping the industry — the decline of self-service washes and the rise of the express exterior. ICA’s 2014 study reports that 57 percent of car wash consumers use conveyors, and of those, express exterior washes are the most popular at 29 percent. “By 2025, conveyors are going to demand more than 80 percent of the total market,” Roman predicted. “Self-service is going to be a dribble, and in-bay automatics are going to decline to about 15 percent of the total market.”

Thanks to the rise of the express exterior wash, operators will be able to offer washes at lower prices, thereby attracting and keeping customers in what is expected to be an increasingly competitive market. According to Jeff Pavone, the principal consultant with Commercial Plus, a firm specializing in car washes, “As the express model expands and competition heats up, prices will likely come down. We are already seeing basic washes offered at $3 to $6 in many markets.”

The value in labor

Over the next decade, labor will be an increasingly important concern for car wash operators. Just when operators are looking for ways to lower prices, labor costs are expected to rise.

Robert Andre, vice president of training and education at Sonny’s CarWash Factory, explains that labor laws and labor costs are on the rise on the West Coast, which could be the beginning of a troubling trend that will soon spread across the country. “Usually, laws that are passed out there are working their way east, south and north,” Andre said. “For instance, in Seattle, the minimum wage is up to $15 per hour, and there is also talk about passing labor laws to require predictive scheduling, which would require employers to guarantee employees a set number hours of work, and once you set their schedules you really can’t change them. Laws like that would make it very hard for the car wash industry, which is a predominantly weather-driven.”

Even though express exteriors are expected to dominate the industry, there will still be customers who want their interiors cleaned at flex or full-service washes. However, the rising cost of labor will make offering these services more difficult. In response to this problem, Andre believes there will be a push toward more manufacturers looking at ways to automate the cleaning of interiors to reduce labor. For instance, Andre expects that technology will be used to automate window cleaning.

On the other hand, in an industry with a growing emphasis on fast and cheap service, some believe that personalized service is what sets them apart from the competition.

Mike Dahm, owner and operator of Mike’s Carwash, which has been in business since 1948, says his operation’s competitive edge comes from the service they offer. According to Dahm, “In our business, we think it is about repeat customers. We want them coming back, and we want them telling their friends about us. So, we try to empower our team members to make decisions and provide personalized customer service.”

Dahm admits that labor is going to be a challenge and that operations are going to be competing with each other to find the top talent, which includes everyone from managers to associates. But he thinks the talent is out there. “It goes back to the golden rule: treat people how you want to be treated. Nice pay and benefits — whatever we can do to really take care of our team members. That’s what I take from my dad and uncle who founded Mike’s back in ’48. Their motto was take care of your team members because if they’re not feeling real good, how could they take care of the customer?” Dahm said.

Accommodating the young crowd

Roman agrees that there will still be customers who prefer quality service over speed and automation. He attributes this increasingly divided industry to a shift in the customer base, which has just begun: the rise of Millennials and the gradual disappearance of baby boomers from roadways. According to the U.S. Census, as of June 2015, millennials (those born between 1982 and 2000) are currently the largest living generation at 83.1 million, surpassing baby boomers by more than 700,000.

Today, baby boomers (who are 51 to 70 years old) still play a considerable roll in the market, and as long as they’re driving, there will be a demand for personalized service. Roman, who got his first taste for the industry in 1967 when he took a summer job as a washer at a local operation, says that his generation still wants service. “I don’t want to wash my own windows. I like the express car wash. It does a good job. It’s quick, but I do not want to vacuum my own car. It’s 95 degrees outside. The humidity is 70 percent. Maybe when I was 25 but not now,” Roman said.

While older consumers appreciate service, millennials are hunting for deals, and they’re doing it using their cell phones. A 2012 survey by Aimia, a marketing and analytics company, reports that only 31–38 percent of older consumers in the U.S., Australia and the UK are likely to use their cell phones to compare prices while shopping, but millennials are much more likely to reach for their cells before making a purchase.

In fact, according to Aimia, 57 percent of American millennials, 58 percent of Australian millennials and 39 percent of British millennials use their cell phones to compare prices online when shopping. Furthermore, at least 24 percent of millennials in all three countries said they checked social media prior to making a purchase, while only 11 percent of older American and British consumers and 19 percent of older Australian consumers engaged in this shopping habit. To accommodate cell phone-savvy millennials, more operations will have to have websites, as well as a presence on social media, where they can build brand loyalty and offer deeper discounts.

Cell phones are expected to become a much more integrated part of the industry in other ways, as well. Both operators and suppliers are predicting a rise in mobile apps that allow consumers to select and pay for wash services.

“Technology is going to be a bigger influence in the next years and even further down the road,” Dahm said. “Anything we can do to make the point-of-sale easier – or the car wash more convenient for the customers – is going to grow.”

Challenges on the horizon

As the industry prospers, small and medium-sized operators are likely to find themselves in a much more competitive market, where large chains can offer washes at a more competitive price.

“As the industry consolidates, there will be a number of large players created that will be able to bring greater resources to the table and potentially the ability to offer a superior, less costly experience to the customer,” Pavone said. “That will put pressure on the smaller owners to follow suit, which could be prohibitively expensive. In a way, it is analogous to the rise of Home Depot and the associated loss of the local family hardware store. It may not be that dramatic, but as a small-wash owner, I would be concerned about my ability to remain profitable in what is quickly becoming a more competitive market.”

Douglas Marquis, VP of business development at Lustra Care Care Products, has been working in chemical manufacturing for 21 years and agrees that the industry is consolidating but adds, “Time has proven that, if done well, consolidation can and does improve and increase the overall growth of an industry. Whether it is national or regional, when an industry or an individual business offers greater overall value to its customer base, it will grow. My view is that car washing will continue to grow, continue to pull people out of their driveways and improve in the coming decade.”

Everyone agrees the industry is in the midst of change, much of it positive. The next 10 years promises to be an era of more express washes, more automation, more technology, and most importantly, more customers looking for a professional car-care experience. On the other hand, all this growth will certainly motivate operators to hone their competitive edge.

Wherever possible, costs will be cut, and owners will turn to social media and mobile apps to win the loyalty of younger drivers. As in all areas of life, change is scary, and the pressure to improve or quit can be overwhelming.

“Operators, whether large or small, who are willing to increase the total-value-package they provide to consumers will do very well in the end,” Marquis said. As long as industry professionals stay optimistic and open to change as they navigate the waters of steady growth, they will certainly enjoy the journey into the next decade.