News from the Industry
Price of water soars in most cities
The annual survey conducted by the NUS Consulting Group, a provider of energy and telecommunications consulting services, found that the average price of water in the United States soared by 7.3 percent for the period ending July 1, 2008.
When including related sewer charges, the survey found the national average rose to $7.08 per one thousand gallons (“KGal”) — an increase of 6.8 percent from July 2007.
The survey, which includes 51 water systems throughout the country, revealed the highest rate was in Boston at $5.76 per KGal while consumers in Savannah, GA, enjoyed the lowest price at $1.09 per KGal. The average cost of water in 2008 for the U.S. was $2.81 per KGal.
Since 2003, average surveyed water prices in the U.S. have increased by nearly 30 percent.
City adopts mobile carwash ordinance
This October, Calabasas, CA, became the second city in the nation to adopt a mobile carwash ordinance, following Fort Worth, TX. Under the new ordinance, mobile carwash owners must obtain a permit and prove they properly discharge runoff water.
The Calabasas ordinance also effectively bans charity carwashes, although it allows residents to wash their personal vehicles at home.
The city took action after “a barrage” of mobile carwashes started showing up on residential and commercial driveways and parking lots, which violated the Clean Water Act because many had no proper equipment to capture runoff and chemicals used to detail expensive cars. City officials originally wanted to ban all mobile carwashes but amended the ordinance after residents complained.
Mace sells one carwash, closes another two
Mace Security International, Inc., formerly one of the largest carwash chains in the nation and now a company that is focused on providing personal defense and electronic surveillance products, has sold one of its Dallas, carwashes for $1.8 million in cash.
Blue Planet Car Wash and its assets were sold for their recorded net book value. Mace used $1.24 million of the proceeds to pay off the related mortgage, and intends to use the remainder of the proceeds for future growth.
Mace also announced that it has closed its two remaining carwash locations in San Antonio. The company previously announced the sale of two other carwash locations in San Antonio, during the fourth quarter of 2007 and said the need for the above-mentioned remaining two carwashes to absorb certain fixed regional operating costs made it increasingly difficult to generate positive operating cash flow at these two facilities.
In conjunction with the closing of these two facilities, management wrote down the assets by approximately $310,000 to its estimate of net realizable value based on the company’s plan to sell the two facilities for real estate value.
“As I previously disclosed to the public, my goal is to sell our remaining carwashes by the first quarter of 2009,” said Dennis Raefield, Mace’s president and CEO. Mace last announced a carwash sale in January of this year, when it closed a deal to sell its truck washes and also signed an agreement to sell a fifth Florida carwash location.
ICA announces executive director change
The International Carwash Association (ICA) Board of Directors has announced that Associate Executive Director Eric Wulf will assume the role of executive director and chief executive officer effective January 1, 2009. Wulf succeeds Mark Thorsby who served as executive director of the organization for more than 15 years.
Thorsby will continue to serve as executive director emeritus, allowing the association to utilize his extensive industry knowledge and acknowledged leadership skills. It also allows Thorsby to focus on his role as the vice president – consulting services for SmithBucklin, the world’s largest professional association management firm who has been the ICA’s management partner since 1994.
For his part, Wulf has been instrumental in the creation of new programs, including introducing the best practice networking program BIGs (Business Improvement Groups), the launch of a new website, and the development of best practice video programs including The Cleaning Edge and Insight, a weekly video newsletter.
Mister Car Wash acquires TX wash
Mister Car Wash has acquired Riptide Car Wash in Stafford, TX, giving the second–largest conveyor carwash chain in the nation a total of 63 carwashes and 25 lube shops across seven states.
“We’re excited to add another carwash in the Houston metro area” said Mike Hogan, vice president of operations for Mister Car Wash. “This latest acquisition helps fill a key retail trade area for us and we’re extremely optimistic about the potential of this location.”
The chain acquired two other carwashes this year in separate transactions. Its size has nearly doubled since 2003, when it was tied with Autobell as the third–largest conveyor carwash chain in the nation at 32 locations.
Financial terms of the deal were not disclosed.
3M acquires Dedication to Detail
3M, a car care product manufacturer based in St. Paul, MN, has acquired Dedication to Detail, a paint finishing company based in Philadelphia.
The acquisition “will complement 3M’s current range of products and create additional growth in the automotive aftermarket and related paint finishing markets.”
Earlier this year, 3M agreed to acquire Meguiar’s Inc., the 100–year–old family business that manufactures the leading Meguiar’s brand of car care products for cleaning and protecting automotive surfaces.
3M’s Automotive Aftermarket Division products currently includes abrasives, accessories, cleaning products, waxes, masking tapes, coatings, sealers, paint finishing polishes and compounds, and paint application systems.
The exact terms of the transaction were not disclosed.
Ryko announces return of CEO
Ryko Manufacturing has announced the return of carwash industry veteran Tom Carleton to the position of CEO.
Carleton has worked with Ryko, a global manufacturer of carwash equipment, for over 30 years, but has been on medical leave since November of 2007.
Jim Nelson will remain chairman of the board, and has announced to the company that, effective immediately, Carleton will resume responsibility for all aspects of Ryko’s activities.
According to Nelson, the company expects to see new challenges as it positions Ryko “to lead not only friction and convenience store carwash markets, but also touchfree, conveyor, private investor, payment, and chemicals.”
Washington goes fuzzy over home washing rules
It looks like Washington state’s rules on residential carwashing are confusing even to legislators and ecology experts. In mid-September, the state told Clark County and cities like Vancouver and Battleground to ban carwashing on the street by next summer. The state said the restrictions were based on the Federal Clean Water Act and designed to limit wastewater runoff into storm drains and nearby streams.
But within a week, the state’s ecology director was backing away from the severity of a ban, saying there was “significant” confusion surrounding the rules and urging cities and counties to work to understand the rules.
The Washington State Department of Ecology told the state that home carwashing was not being banned under the Federal Clean Water Act, and the ecology director wrote to cities and counties affected by the state’s new clean–water rules.
State environmental experts said that people should wash cars on lawns or gravel driveways so that the contaminated water will soak into the ground. They also said that residents can wash on pavement if they install special barriers which keep the water from getting into the drains.
But it doesn’t look like the controversy concerning residential carwashing is going away in Washington. King County, home to Seattle, is putting together a proposal to ban home carwashing completely if runoff water goes in the storm drains. Curt Crawford, manager of the storm water services section for the county, said he thinks the proposal should pass this fall. “We just don’t want soapy wash water going out into streams [to] kill fish,” he said.
The state reiterated in October that home carwashing was not being banned after a waterless carwash company used an incorrect statement about residential carwashing to promote its product.
However, the agency said it is urging cities and counties to educate residents about how to keep soapy, dirty water from entering storm drains; ditches; and, ultimately, lakes, streams and the state’s marine waters.