Huge Cash Flow & Tax Benefits: Why You Should Invest in Car Washes

The Big Picture on Car Washes As Investments:

• • Modern express car washes can generate 5–12% returns with minimal staffing and high automation.
  • Car washes perform well during downturns as people maintain existing vehicles instead of upgrading.
  • Accelerated and bonus depreciation allow significant tax write-offs, especially in the first year.

When most people think about diversification, they picture a pie chart split between stocks, bonds, and maybe some real estate. But if you’re only thinking in those broad strokes, you might be missing out on some of the most exciting and overlooked investment opportunities — ones that can offer both cash flow and appreciation.

In a recent conversation with Whitney Elkins-Hutten, Director of Investor Education at PassiveInvesting.com and author of Money for Tomorrow, we explored one such niche: investing in express car washes.

Yes, you read that right — express car washes.

And no, we’re not talking about those quarter-operated stalls behind gas stations or the full-service locations with a dozen employees scrubbing down every car. Whitney’s talking about a totally different beast — the “Chick-fil-A of car washes.”

What Makes Express Car Washes So Special?

Modern express car washes are highly automated, environmentally conscious operations that can clean 400–500 cars a day with only 2–3 full-time employees. Equipped with long tunnels, barcode scanners, and water reclamation systems, they’re not just efficient — they’re cash-flow machines.

Whitney explains that these facilities operate like a hybrid of a business and a piece of real estate, which means you get the benefits of both worlds: predictable income and potential property appreciation.

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But What About Recession Risk?

Surprisingly, express car washes hold up exceptionally well during downturns. Data shows that during economic slumps — including the 2008 crash and the 2020 pandemic — people tend to take better care of their current cars rather than trade up. And that means more trips to the car wash.

In fact, during the 2020 lockdowns, car washes became a form of family entertainment, especially the ones featuring lights and retrofitted tunnels for that five-minute “ride” experience.

In short: people still washed their cars, and business stayed strong.

The Tax Advantages Are No Joke

One of the most compelling aspects of investing in express car washes is the accelerated depreciation. Because the wash equipment is integral to the operation and physically attached to the building, investors can depreciate both the real estate and equipment over a short time frame — often within the first five years.

Throw in bonus depreciation, and much of it can even be claimed in year one, which is a huge tax shield for high-income earners.

What Kind of Returns Can You Expect?

Returns depend on the stage of the investment:

• Operational car washes can offer 5–7% cash flow in year one, growing to 10–12% by year five.
• Turnkey (newly built) washes may start with minimal cash flow as the business ramps up.
• Ground-up developments generally see a longer runway before cash flow kicks in.

   

Whether you’re seeking immediate yield or longer-term growth, there’s a model that can work based on your investment goals.

Should You Consider Adding a Car Wash to Your Portfolio?

If you’re an investor looking to diversify outside of traditional real estate, or if you’re tired of compressed cash flow in multi-family or self-storage, this might be a perfect fit. Car washes offer a blend of stability, automation, tax efficiency, and recession resistance that few other assets can match.

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Learn More from Whitney

Whitney Elkins-Hutten helps high-income earners and business owners turn savings into long-term passive income. You can connect with her at Passive Investing with Whitney, where she offers free resources and 1-on-1 calls to explore how passive investing can fit into your financial plan.

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Final Thoughts

In a world where “weird” might just be your portfolio’s biggest edge, investing in express car washes is a bold — and surprisingly savvy — move.

If you want to explore more unconventional investing ideas, join our Co-Investing Club, where we pool resources, evaluate private investments, and learn together. Get started for free here.

Stay weird, stay curious, and invest differently.