Car Washes: The ‘Affordable Luxury’ Subscription Consumers Are Keeping

At a time of soaring inflation and rising interest rates, consumers are not cutting back on car wash subscriptions.

At Mister Car Wash, the number of subscribers June 30 was 20% higher that it was at the same time the previous year, the company said Thursday (Aug. 11) in its second-quarter earnings release.

In Mister Car Wash’s most recent investor presentation, which was released in April, the company attributed the demand for car washes to consumers’ desire for “affordable luxury,” adding that the industry has proven to be resilient during past economic downturns for that reason.

Beyond that, the company said in the presentation, the car wash industry has benefited from a shift in customer preferences toward “do-it-for-me” services.

“We think our second quarter results demonstrate the resilience of our business,” Mister Car Wash Chairperson and CEO John Lai said in the earnings release. “Demand throughout the quarter remained relatively consistent, and we did not see a meaningful change in cancellation rates or the makeup of our Unlimited Wash Club subscription business.”

Mister Car Wash, which operates more than 400 car washes across the country, reported in the release that it added 59,000 subscribers during Q2, bringing the total to more than 1.8 million. It added that subscription sales accounted for two-thirds of its total car wash sales during the quarter.

In the presentation, the company said it has driven subscription growth by focusing on delivering service, speed and convenience.

PYMNTS research has found that subscriptions-based goods and services present people with choice and flexibility, and they are signing up in record numbers.

In the “Subscription Commerce Tracker,” a PYMNTS and Vindicia collaboration, it was reported that while some amount of churn is inevitable, companies can reduce cancellation rates by improving their billing process to automate payments and by personalizing the customer experience.

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