A drive into the Car Wash Market

” Today, with changing preferences and growing incomes, a typical middle class or upper middle class Indian consumer moves around in a sedan or SUV. Several thousands Audis, Benz, BMWs, Volvos, Hyundais, Hondas, Mahindras… have hit the Indian roads in the last five years taking the overall motor vehicle count to over 200 million! As India is speeding ahead in the global car consumer market, the professional car wash segment is just picking up to join the race. Clean India Journal drives down the Indian market to study the existing car wash roadmap and routes crossing in from different parts of the globe.”

 Professional car care/car wash is a significant market internationally in the developed countries. India, an emerging economy and the ninth largest auto industry in the world, is not far from becoming a booming market for car wash.

The Indian car market growing at 10% annually is estimated to have the highest number of cars by 2050 with consumer market expected to be the fifth largest in the world by 2025.

Conventional Route

In a typical Indian scenario, it is common to watch a cleaner boy diligently wake up much before the break of dawn, load himself with a piece of cloth, some local detergent and a bucket of water and move from one car to another in the parking lot, doing his best to make the car look clean.

Introducing Car Care Expo

Expanding the horizon from cleaning surfaces to cleaning car, Virtual Info Systems Pvt Ltd is launching Car Care Expo, which will be held alongside the 13th edition of Clean India Show – Clean India Pulire – and three new shows: IFS Expo, Laundrex India and Waste Technology India Expo from January 21 to 23, 2016.

Know your facts:-

• Process of car wash involves cleaning, washing, drying, polishing besides detailing and other cosmetic care.
• Car wash includes both exterior and interior cleaning.
• Exterior cleaning includes techniques like hot water, detergent foaming, steam cleaning, waxing, highpressure
  cleaning, coating, etc. This is achieved through various mechanized processes and automatic systems.
• Interior cleaning includes seat cleaning & conditioning; roof, side panels and dashboard dressing; floor vacuuming; carpet cleaning; detailing; grooming; regulating air quality; etc.

 In the absence of a car wash facility in the neighborhood, more than 90% of the vehicles across the country are manually cleaned each morning. Given the busy lifestyle, some owners depend on service centers too for a periodical professional car wash. Indian car owners today are not having many options for car cleaning and detailing and they are still bound to take their car to road side garage for cleaning services. They wanted to spend more on the car but finding a right service station which can give them the 100% satisfaction is a problem.

Moreover, car wash has not gained much prominence in smaller cities compared to metros and big cities. However, with luxury car sales being up by almost 60%, the demand for professional car care is catching up. The telematics market is also very matured as most of the OEMs are incorporating the latest M2M technologies. The requirements of a high end car owner are not always met by local garages and manual cleaning processes.

 

Logically, a car wash can be a good business opportunity now. Customer knowledge is also improving and there is a lot of interest in car detailing business. When India has a potential market for automatic car wash centres, there a lack of good indigenous automated machine. Imported automated machines are very expensive, with high maintenance costs and no service provided after sales. If good quality machines with affordable maintenance cost, and after-sale services are provided, more traders would be interested in promoting automated car wash centres. Here is an opportunity for both national and international companies to set up manufacturing facilities.

Car Wash Services

At the global front, car wash services is likely to exceed $27.4 billion by 2017 largely owing to soaring car sales. Consumers are now looking at a professional solution for best results in the shortest possible time. There is a huge potential market for professional detailing and quality & quick servicing also.

 Professional car wash companies opine that the lack of many players in the service segment is not due to lack of enthusiastic investors but due to the expensive investment in fully automated imported machines and dearth of indigenous manufacturing of car wash equipment. However, the increasing demand for fully automated systems is a major driving factor promoting automated car wash centres.

Besides the few PCW service providers spread across India, many car showrooms in major cities too have inbuilt car wash and service station. Further, auto makers and suppliers have opened up car care centres as part of customer service.

 

International Perspective

 The aftermarket auto segment on the international front that has been moving in parallel with the auto industry, is looking at alternate markets, as many of the European markets is fast shrinking.

 Speaking to international car wash industry players in Italy – the manufacturers and service providers – it is felt that the European market, flushed with car wash facilities, has almost saturated and the scope for newer opportunities are limited. Apart from Russia and Eastern Europe, Africa and other far-east countries, the manufacturers are upbeat about the Middle East and Indian markets.

“Looking at the economic conditions, especially in Italy, we are trying to export as much as possible since last year,” says Andrea Bianco, Export Manager-Aquarama, Italy. “We have experienced very good response in exhibitions and are looking forward to participate in expos in Dubai and India. The Middle-east, Saudi Arabia and Oman markets are very interesting. In fact, in Dubai we have established good contacts and are in the process of installing our machine in a new project. We have lined up several projects for this year which are at the concluding stages. This includes India too. As soon as we complete the Dubai project, we will be focussing on India.

“Unlike the Russian and European markets, the approach of the user is different in the ME and Indian markets. For example, take the use of brushes. While brushes are an inherent part of car care, in Russia and ME customers are uncomfortable and fear that brushes can leave scratches. Hence, we had to adapt to the needs of the customer and have customized car wash with high pressure cleaning facility. So we have our portal gantry without brushes and just high pressure and water,” Andrea adds.

“It is not just the approach or attitudes, even the decision making process in India is much slow,” adds Erico, Hawk.

 “Europe is more of a traditional business but ME and far-east is a developing market. We see a lot of opportunities but it is first important to understand the culture of the people to know their expectations. Everyone wants quality but cultural aspect have to be considered,” says Sandro Bellinzes, Export Manager, MTM Hydro, Italy.

Manufacturers who have entered the Indian market previously either through a customer or a short time importer, have burnt their fingers in a few instances. The skepticism and speculation arising over past experiences has deterred players to explore into the Indian market.

Some of the manufacturers in the cleaning business are also providing solutions for car care in the Indian market. “We participate in the auto shows and also the cleaning shows, including the Clean India Shows in India, says Mark Winter, Export Manager, Maer, Italy.

“India and ME markets are big and tempting. We have sold some machines in India, especially steam cleaning for the food manufacturing companies. However, because of the low-cost Chinese machine infiltration in India and the high price we pay as import duty on our machines, it is a difficult to establish a good business model. We are looking at participating in the forthcoming Clean India Pulire Show in Mumbai and the CMEP show in Dubai,” adds Mark.

Car cleaning chemical manufacturers, on the other hand, are viewing closer markets, including North Africa and South America. While the ME and Indian market seem interesting, the transportation cost involved in exporting to these markets is rather discouraging.

 Some of the chemical manufacturers who are exporting extensively to the Fareast and Asian markets are looking at expanding into the ME and Indian markets. “While Italy is a saturated market and we already have a lot of customers now, it is important for us to expand into the other European and other markets,” says Krizia Eisera, Export Department, Kimicar, Italy.

“We have ready-to-use and also professional concentrated range of products and are already exporting to Romania, Uruguay, Taiwan, China, Albania, Switzerland, France, Spain and so on. The ME and Indian market are growing by the day and we are interested in expanding into those markets too. At present, we do not have anyone importing from these countries but we hope to start soon,” adds Krizia.

 Lavorwash, leading cleaning equipment manufacturer from Italy, has been operating through several distributors in India. “This year we have introduced new models in the steam cleaning and high pressure with foaming facility for the car wash segment,” says Giovanni Mora, Operation Manager, Lavorwash, Italy. “These products have generated a lot of interest as steam can also be used for sanitizing the interiors of the car.

“These machines will generate interest in the Indian market too eventually. India is not yet ready, basically due to the cost factor. Being labour intensive, customers invest say about $100 on a cleaner than invest in machines.

“Moreover, the approach towards car cleaning is different in India and Europe. In India, people prefer to take their cars to the dealers or service stations to get their cars cleaned. However, in Europe and also in Italy, it is very common for the car owner to clean the car himself at the car washing bay. It is a simple process at the washing bay where the customer parks the car in the bay, selects the washing program, inserts the coin and cleans the car. This system does not have a drying process but the chemicals used in washing makes the car ready for using. The water used for cleaning consists of chemicals and drying wax which does not let the water settle on the surface. In India, probably there is only one such facility on the way to Pune.

“Due to the rapid changes taking place in this market, the demand is likely to go up. At this moment, since the volume of consumption of our machines in India is not very big, it is not conducive to open a subsidiary or branch office. Being a manufacturer, we will wait for better conditions to consider opening a facility in India for some of our product range. Until then we will go with our distributor network.

“Presently, we have about four importers in Delhi, five in Mumbai and several small players in other areas. We are also providing customized pressure jets to Eureka Forbes and Sealedair for the domestic market. We already have sold about 20,000 machines in the domestic line in India,” adds Mora.

– Mohana M