Revised and updated January 11, 2021.
When Henry Ford launched the Model T, part of his business model was making a car that people could repair for themselves. As automobiles have become more complicated, that has become impossible for most people, and so we’ve become reliant on repair and maintenance businesses. At the same time, the number of vehicles in use has risen, with 280 million registered cars, trucks, and SUVs in the US. That makes auto repair and maintenance a reliable business that will keep its importance regardless of shifts in the economy.
Work has become more complex for repair and maintenance franchises, as vehicles have become increasingly high-tech. Yet many of the basics remain the same, meaning that entrepreneurs can enjoy the benefits of a proven business model. The specifics of repairs and maintenance are often different from a generation ago, with cars increasingly run by computers that can diagnose other faults or develop problems of their own. But the shape of the business around those repairs is the same, and customers are still looking for the same output: a fully functioning car.
The age of cars on the road has been increasing for over a decade, with the average American car now nearly 12 years old. This figure is expected to keep rising, as rising vehicle prices, longer lasting vehicles, and the impact of the COVID-19 pandemic lead to people taking longer to replace their cars. As a result, more cars are out of warranty and showing the effects of wear and tear, creating work for maintenance and repair businesses. Car manufacturers’ loss is auto mechanics’ gain.
After the decline of full-service gas stations, chains started popping up to meet the consumer demand for automotive maintenance and repairs, creating a great opportunity for franchises. Many focused on one service in particular, such as oil changes, brake jobs, alignments, tune-ups, mufflers, tires, and so on. Over the past few decades, most of these specialty chains have expanded the range of repairs and services they will handle beyond their original niche, making auto repair and maintenance a multi-faceted business. Providing a range of services in one place makes things more convenient for the customer and more profitable for the business.
Auto maintenance and repair franchises are worth an estimated $8.9 billion in the US. This was spread across over 9,500 businesses employing more than 70,000 people in 2020. The industry saw an annualized market size growth of 1.3% per year from 2016, as unemployment went down, the economy grew, and people used their cars more to commute to work.
Auto repair and maintenance businesses don’t require a large amount of face-to-face interaction, and they are considered an essential service, so they were able to stay open during the COVID-19 pandemic, even in areas with strong restrictions. But reduced contacts to counter the pandemic had some impact on auto businesses. Some non-essential or non-urgent work was postponed by customers. With people moving about less, there was a drop in the amount of wear on vehicles and the number of accidents leading to repair work. Disruption to manufacturing and distribution affected the supply chains for components.
Improved hygiene facilities and procedures had to be brought in for customer contact, for example changing drop off and pickup procedures. However, these changes were less burdensome than for franchises with high customer contact, such as hairdressers or coffee shops. So while the global auto repair and maintenance industry has seen a slight decline thanks to COVID, it is surviving far better than many industries.
Auto maintenance businesses aren’t completely immune to an economic downturn, and the long-term impact of COVID will have some effect on these franchises. Though there are many repairs that need doing no matter what, car owners are more likely to postpone non-essential or non-urgent work when money is short. However, cars are such an essential part of American life that this work can only be delayed so much. 64.5% of auto mechanic customers are individual households, many of whom are reliant on their cars to get to work, shop, carry kids to school, and engage in leisure activities. If maintenance is delayed then it may lead to more expensive repairs later.
Auto maintenance and repair is a labor-intensive business. Franchises spend 28.2% of their revenue on wages, and franchisees should be ready to recruit and manage a workforce whose skills and experience are essential to the running of the business. But franchising helps to reduce costs in other areas for auto businesses, as a brand’s purchasing power can lead to deals with suppliers that trim the costs on equipment and parts. As people return to moving around, there’s going to be plenty of work to keep these franchises busy, and plenty of opportunity to leverage their advantages.
1. Midas International
Midas International started out specializing in mufflers and exhaust systems in the 1950s, added shock absorbers in the 1960s, and brake services in the 1970s. In the 1990s, it expanded further into total car care (including tires) for both individual consumers as well as corporate customers and total fleet management services (including a web-based app). The company is always running a wide variety of promotions, coupons, and rebate offers that keep customers coming back for more. It also offers a credit card program.
Midas was named the top automotive repair brand in the America’s Best Customer Service 2019 report assembled by Newsweek after surveying more than 20,000 consumers.
Midas was purchased by TBC Corporation in 2012. Founded by Nate Sherman in Macon, Georgia in 1954 and franchising since 1956, the number of locations has declined in recent years from 2,351 in 2010 to the current total of 2,017 (up from the previously reported total of 2,011), none of which are company-owned and 1,025 of which are located outside the US.
2. Meineke Car Care Centers
Meineke Car Care Centers got started with exhaust services in the early 1970s, and in 2003 expanded into a full range of auto maintenance and repair services. Parent company Driven Brands owns a variety of auto-related companies, including Maaco (collision and paint repairs), CARSTAR (direct repair program and collision work), Econo Lube N’ Tune & Brakes, 1-800-Radiator & A/C, and Take 5 (oil changes). Similar to Midas, Meineke offers a credit card program as well as fleet management services for corporate customers.
In the Newsweek study of America’s Best Customer Service 2019, Midas may have won for “best automotive repair brand,” but Meineke won for “best automotive repair chain.”
Founded by Sam Meineke in Houston, Texas in 1972 and franchising since that same year, the number of locations has declined in recent years from 980 in 2014 to the current total of 807 (down from the previously reported total of 809), of which none are company-owned and 81 are located outside the US.
3. CARSTAR Franchise Systems
CARSTAR Franchise Systems is a chain of independently-owned collision repair facilities offering auto body repair, paintless dent repair, storm damage repair (including hail damage), and 24/7 accident assistance. Like Midas and Meineke, the company offers both a credit card program and fleet management services.
CARSTAR gets a lot of its business from strong partnerships it has developed with insurance companies for its DRP – direct repair program. The company focuses on franchisee training on how to meet the repair standards required by insurance companies. The company offers a national warranty that stays with the owner no matter where they’re at in the US as well as a service guarantee.
Founded in 1989 and franchising since that same year, the number of locations has climbed in recent years from 387 in 2010 to the current total of 702 (up from the previously reported total of 677), of which two are company-owned and 314 are located outside the US.
4. AAMCO Transmissions and Total Care
AAMCO Transmissions and Total Care has a similar mix of services as the other companies on this list, including a full range of auto repair and maintenance services, a credit card program, and fleet management services for corporate and government clients. Rather than offering a blanket warranty covering all its work, AAMCO has nine different warranties of varying lengths depending on the services the customer needed.
The company name is an acronym standing for the founder, Anthony A. Martino Company, which guaranteed great placement in the Yellow Pages phone book listings in the auto repair category. The company started out specializing in transmission work, but has since grown its services menu to include all kinds of auto repair and maintenance.
Founded by Anthony A. Martino in Philadelphia, Pennsylvania in 1957 and franchising since 1963, the number of locations has been steadily declining in recent years from 852 in 2010 to the current total of 569 (down from the previously reported total of 611), of which 13 are company-owned and seven are located outside the US.
5. Precision Tune Auto Care
Precision Tune Auto Care, as the name implies, started out specializing in providing tune-up services but has since expanded into the usual full array of auto maintenance and repair services as the other companies on this list. It also offers its own credit card program and fleet management services for corporate clients and government agencies.
The company’s work was guaranteed by a 12-month/12,000-mile national warranty, which was expanded into a 24/24 national warranty in 2011, but the company website currently only mentions the 12/12 warranty. There are specific location websites that do still mention a 24/24 warranty.
Precision Tune was purchased by Icahn Automotive in 2017, a company that also owns Pep Boys (aftermarket retail and service) and Auto Plus (aftermarket parts distributor). Founded by Bill Childs in Beaumont, Texas in 1975 and franchising since 1978, the number of locations currently totals 289 (down from the previously reported total of 326), of which 48 are company-owned and 52 are located outside the US.
6. Christian Brothers Automotive
Christian Brothers Automotive is a faith-based chain of automotive repair shops that explicitly incorporates Christian values to shape its business practices. The shops work on all makes and models of vehicles, and back up their work with a 24/24 national warranty (24 months/24,000 miles) good at any of the company’s locations.
It is also known for putting a great deal of care and attention into the customer experience, including clean, spacious waiting rooms, complimentary beverages, free WiFi, complimentary shuttle service, and above all being treated with courtesy and respect.
Founded by Mark Carr in Mission Bend, Texas in 1986 and franchising since 1996, the number of locations has been on a steady upward trajectory over the past 10 years from 53 in 2008 to the current total of 217 (up from the previously reported total of 204), of which two are company-owned and all are located in the US.
7. Tuffy Tire and Auto Service
Tuffy Tire and Auto Service began by first specializing in mufflers, but has expanded from there to become a full-service shop that also works on brakes, shocks, struts, springs, alignment, front-end, oil change, tires, air conditioning, batteries, starting and charging, flush and fill, and CV joints.
Customers are automatically eligible for a free full year of ToYourRESCUE roadside assistance (lockouts, flat tires, jump-starts, towing, and more), and the company guarantees its work with a 12/12 national warranty on parts and labor. Customers also receive a complimentary courtesy inspection to make sure tires, brakes, fluids, exhaust system, battery, belts, and more are in good working order. Like the other companies on this list, there is a credit card program as well as fleet management services for corporate customers.
Founded by Charles Amy in Detroit, Michigan in 1970 and franchising since 1971, the number of locations has declined in recent years to the current total of 168 (down from the previously reported total of 171), of which 21 are company-owned and all are located in the US.
8. Milex Complete Auto Care/Mr. Transmission
Milex Complete Auto Care/Mr. Transmission are two of the companies that fall within the Moran Family of Brands, a company that also franchises AltaMere Automotive Outfitters, Multistate Transmission, Dr. Nick’s Transmissions, and SmartView Window Solutions (window film options for home and office). Franchisees may select a standalone MilexComplete shop, a standalone Mr. Transmission shop, or a co-branded Milex Complete/Mr. Transmission combination shop.
The company offers a full range of auto repair and maintenance services, seven different warranties depending on what type of work was done, and fleet management services. Unlike most of the other companies on this list, it does not appear to have a credit card service for financing.
Founded in 1956 and franchising since 1976, the number of locations currently stands at 89 (down by one from the previously reported total of 90), one of which is company-owned and one of which is located outside the US.
9. Honest-1 Auto Care
Honest-1 Auto Care has three distinguishing characteristics that set it apart from all the other companies on this list. Firstly, it is the only one founded since the start of the new Millennium. Secondly, it’s the only one that emphasizes the different ways it is an eco-friendly car care company. Its Honest-1 Auto Care ESA (Environmentally Sustainable Actions) Program focuses on pollution prevention, recycling, resource conservation, and promoting eco-friendly auto care services. Thirdly, its national warranty is good for 36 months or 36,000 miles.
Customers enjoy clean, comfortable, appealing waiting areas suitable for women and families with leather couches, large-screen TVs, workstations, and free WiFi, secured children’s play area, upscale bathroom décor, and complimentary beverages.
Founded in Scottsdale, Arizona in 2003 and franchising since that same year, the number of locations has grown steadily in recent years from 23 in 2010 to the current total of 63 (down from the previously reported total of 73), of which two are company-owned and all are located in the US.
10. Merlin 200,000 Mile Shops
Merlin 200,000 Mile Shops has a name that gives away its mission – to help car owners get more than 200k miles out of their vehicles. So many people still think anything over 100k is amazing, but cars these days are built way better than that. In other words, Merlin wants people to know and act as if they can and should get to the 200,000 odometer milestone.
The company offers a full range of auto repair and maintenance services, including oil changes, brake service, fluid exchanges, tire replacement, mufflers and exhaust, shocks/struts/springs, and 18 more common services. Its warranty on most repairs is a 24/24 arrangement, but it does offer a 200,000-mile warranty on mufflers, brake pads, and brake shoes, as well as certain brands of tires. It also offers a credit card program, but does not appear to have fleet management services.
Founded in 1975 and franchising since then, the number of locations has declined in recent years from 58 in 2010 to the current total of 26 (down from the previously reported total of 30), of which one is company-owned and all are located in the US.
An Important Note About Our Methodology
The franchises on this list were ranked according to the number of units in the franchise system. If you are a prospective franchisee searching for franchise opportunities that meet or exceed certain performance benchmarks for sales, profits, and return on investment, please check out this list of America’s Most Lucrative Franchises.
Leave a Reply