Car Wash Feasibility Study in the Detroit-Warren-Dearborn, MI Metro Area

A wide spread of car wash loans in a cold-weather market

The Detroit-Warren-Dearborn car wash file is notable for the range of its loans. The median of $400,650 is 0.43x the national median, yet the middle loans stretch from $59,000 to $978,100, so small equipment loans sit beside large site purchases in one cell. The area is 7th of 458 for car wash loans and the class is twelfth of 39 locally. The location quotient of 1.38x shows car washes taking a bigger local share than the national share. The 88 approvals from FY2017 to FY2026 carry $75.1 million.

The program count shows 74 loans in SBA 7(a) and 14 in SBA 504. Macomb County has 34 of the loans, Wayne County 25 and Oakland County 21. The franchise share is withheld for this cell and is not printed.

One bank, one specialist

Only two holders reach SBA's list. The Huntington National Bank shows 29 loans and $6.3 million; Celtic Bank Corporation shows 10 and $15.9 million, a book of very large loans. The contrast is one of size, not number: a Huntington loan is on average a fraction of a Celtic loan. These are holders of record. They say nothing of the policy of either.

Of Detroit approvals from FY2017 to FY2024, 18.4% or more were cancelled. Ten Detroit values never reach this page: the ceiling, the loss rate to date, and both the loan count and the dollars for each of FY2018, FY2020, FY2025 and FY2026, all thinly supported; none is printed, and none implies zero. In the years shown, FY2017 had 8 loans, FY2021 had 12 worth $15.6 million, and FY2024 had 10 worth $5.0 million.

What a Detroit-area car wash study has to test

Winter dominates the cash flow. The study should model monthly volume with the effect of cold, salt and snow, since road salt drives demand on clear days after a storm, while freezing weather can shut down an exterior bay or an unheated tunnel. Traffic counts, the number of competing washes and the share of revenue from memberships all need to be shown for the specific site. Equipment, water and wastewater rules and site work are major costs, and the appraisal for an owner of the land should value real estate apart from the business. Car washes, truck washes and mobile washes are reported under one industry entry, so the class cannot isolate any one type. Southeast Michigan counts omit loans whose county never matched the July 2023 list.