Drivers in Music City, like those in the rest of the country, are fond of hanging on to their cars and trucks, as opposed to taking on a new set of payments. And at least one national car-repair chain is expanding its Nashville presence to serve those drivers.
With just three stores in the Nashville area, 45-year-old car care company Meineke Car Care Centers, LLC is greasing the wheels for growth here. The franchise operation that sees itself as “one-stop shop” for vehicle repairs and maintenance aims to fill a gap in the local market.
The U.S. auto repair business is a $63 billion industry that is fragmented and diverse; no single player controls more than a 5 percent market share, according to research firm IBISWorld. Prospects for continued growth are solid. According to Consumer Reports, the average price of a new car has risen to around $34,000 these days. One consequence is the fact more vehicle owners are doing their best to keep their current rides on the road; the average age of a vehicle in the U.S. in 2016 was 11.6 years. So the demand for both preventive maintenance and repairs is higher than ever.
“We conducted research in every market out there, and we picked the markets that are more conducive to our growth and have a heavy demand for our services. We're underserved in the Nashville market,” explained Ed Pearson, Meineke’s vice president of franchise development.
By 2022, the North Carolina-based franchise operation hopes to scatter 19 more stores throughout the metro area. Particular focus will be placed on areas like Gallatin, Greenbrier, Ashland City, Fairview, Franklin, Brentwood and Springfield, Pearson said.
Auto industry parallels
Ashley Frye, executive director of the Tennessee Automotive Manufacturers Association, sees a clear link between increased demand for after-care services and Middle Tennessee's thriving automobile manufacturing industry.
“It’s natural to expect coming from a state that produces 1.7 million cars a year – coupled with the growing population to support the growth of the automotive manufacturing taking place in Tennessee – that we would also see the evolution of a growing base of automotive retail supply businesses to support the growth of our industry," Frye said.
In addition to the increased market need, Pearson highlighted another reason to rev up their Nashville presence: low property values.
“Nashville is a vibrant, growing economy; [companies] want to be part of that,” Frye said. “In addition to that we take into consideration the cost of the real estate. The cost associated in the Nashville area is lower than some of the other growing markets in the country such as Miami, where the cost of property is 20 to 30 percent more.”
Welcome to the neighborhood
But how does an established local player feel about 19 new Meineke stores?
Valvoline Instant Oil Change currently operates 21 locations in the greater Nashville market, along with stores in Chattanooga, Memphis and Knoxville. But the chain that focuses on quick oil changes isn’t all that concerned about Meineke's planned expansion.
“How will they impact us? It's hard to say," said Tony Puckett, president of the Kentucky-based franchise operation. "Their focus has not historically been quick oil changes. The fact that Meineke is a good brand, and I'm sure they will be well-run, it's good service for the Nashville market and it's a good thing.”
Puckett also said Nashville is one of his company's “favorite markets” and that Valvoline is looking to add stores here, having recently scouted potential sites.
“We face competitors in every market," he said. "We are certainly aware of who our competitors are – but we're just trying to take care of those customers who choose Valvoline. That's what we'll continue to do in Nashville,” Puckett said.