Complete Guide to Car Wash Business in Saudi Arabia 2025: New Regulations, Equipment, Costs, and Expected Profits

Introduction: Why a Car Wash Business?

The car wash business is one of the most attractive small and medium enterprises for young entrepreneurs in Saudi Arabia. With the number of registered vehicles in the Kingdom exceeding 15.8 million by the end of 2024, the demand for car washing and cleaning services continues to grow. This business is characterized by moderate capital requirements, year-round demand, and relatively easy management, making it a promising investment opportunity worth thorough study.

In this comprehensive guide, we provide everything you need to know before entering this business: from the new official regulations and required equipment, to detailed costs and expected profit calculations, with focus on important updates to fuel station and service center regulations.

First: Types of Car Washes in Saudi Arabia

Before starting your project, you must understand the different types of car washes and their differences in terms of cost, returns, and requirements.

Traditional Manual Car Wash

This is the most common type and relies primarily on human labor. It uses relatively simple equipment such as high-pressure washers, vacuum cleaners, and cleaning materials. It features lower setup costs ranging from 80 to 150 thousand riyals, and flexibility in providing various services according to customer requests. However, it requires 3-5 workers, and service quality depends heavily on worker skill and commitment.

Automatic Car Wash

This type relies on advanced mechanical and electronic systems that work automatically. It is divided into two main types: Roll-over system where the car remains stationary while the machine moves around it, and Tunnel system where the car moves through a washing tunnel. It features high service speed reaching 50-60 cars per hour for tunnel systems, significant savings in labor costs, and consistent quality. However, setup costs are high, starting from 200 thousand riyals and may exceed 600 thousand for advanced systems.

Mobile Car Wash

A modern business that has spread in recent years, relying on providing washing service at the customer's location whether at home or workplace. A van or small truck is equipped with all necessary equipment including water tank, pressure washer, generator, and cleaning materials. It features lower setup costs ranging from 50 to 120 thousand riyals, no need for shop rental, and high mobility flexibility. However, it must be affiliated with an existing licensed car wash.

Second: New Requirements for Car Washes

The year 2024 witnessed fundamental updates in fuel station and service center requirements issued by the Permanent Executive Committee for Service Centers and Fuel Stations. These updates directly affect those wishing to establish a car wash inside a fuel station.

Important Decision: Manual Car Washes Banned Inside Fuel Stations

Among the most prominent updated requirements is the complete ban on manual car washes inside fuel stations. Only automatic car washes operating mechanically are allowed inside stations. These washes are implemented according to manufacturer requirements, and their space is determined based on equipment size and operational requirements. The corrective period for existing stations is 12 months from the date the requirements were issued.

Important Clarification

This decision does not mean that all car washes must be inside fuel stations. Rather, it means that if you want to establish a car wash inside a fuel station, it must be automatic. As for independent washes in other commercial locations, they can be manual or automatic according to your choice.

Location Requirements for Car Washes

The location must be within service centers or specialized maintenance centers according to plans approved by the municipality. Parking spaces must be provided at a rate of one space per 50 square meters of building area with a minimum of two spaces. The minimum area is 100 square meters in specialized maintenance center buildings, and 30 square meters per car in service centers.

Environmental Requirements

Discharging water after use into the public sewage network without prior treatment is prohibited. Water drainage floors must have appropriate slopes. Water is treated using petroleum and grease traps, settling and oil filtration chambers according to health requirements. In the absence of a public sewage network, a local sewage system must be installed.

Third: Required Licenses and Procedures

To ensure legal business practice and avoid violations and fines, you must obtain a set of licenses and permits from the competent authorities.

Commercial Registration

The first step is to obtain a commercial registration from the Ministry of Commerce through its website. Select car washing and lubrication activity, and determine the registration period from one to 5 years. Commercial registration fees are 200 riyals annually plus Chamber of Commerce fees.

Municipal License

Obtained through the Balady electronic platform. A new commercial activity license application is submitted with required documents including ID or residence copy, commercial registration copy, lease contract or ownership deed, and location illustration. After inspection and approval, the license is issued at a cost ranging from 1,000 to 3,000 riyals depending on area and location.

Civil Defense Approval

A safety certificate must be obtained from Civil Defense through the Salamah portal. Requirements include providing sufficient fire extinguishers, fire alarm system, appropriate emergency exits, and safety guidance signs.

Environmental Permit

In some areas, a special environmental permit may be required for water treatment and proper waste disposal.

Mobile Car Wash Requirements

To obtain a mobile car wash license, the vehicle registration must be valid for at least 6 months, written traffic approval with complete vehicle data, the mobile wash must be affiliated with an existing licensed car wash, a surveillance camera must be installed in the vehicle, and compliance with environmental and municipal license requirements for the affiliated district.

Fourth: Required Equipment and Best Brands

Choosing the right equipment is one of the most important factors for project success. Good equipment means higher service quality, longer lifespan, and lower maintenance costs.

Manual Car Wash Equipment

High-pressure washers are the backbone of any car wash. The best global brands include Kärcher from Germany which is the best worldwide with pressure power up to 145 bar and prices ranging from 1,500 to 3,000 riyals. Bosch from Germany offers excellent quality at prices ranging from 800 to 1,500 riyals. Stanley from America is known for durability and strength at prices of 600 to 1,200 riyals. Black and Decker from America offers economical options at prices of 500 to 1,000 riyals. SUN JOE from America with 1800 watt power is considered among the best at prices of 700 to 1,200 riyals.

Industrial vacuum cleaners are important for cleaning the interior cabin. Polishing equipment includes polish machines, polishing materials and wax. Manual cleaning tools include brushes, sponges, microfiber cloths, and washing buckets. A water tank with 1,000 to 2,000 liter capacity is essential for work continuity. Cleaning materials include car shampoo, wax, tire cleaners, and air fresheners.

Automatic Car Wash Systems

Several specialized international brands are available. Risense from China offers competitive prices with good quality and provides Roll-over and Tunnel systems. WashTec from Germany is the most expensive and best quality. Istobal from Spain offers European quality at medium prices. Christ from Germany specializes in large systems. Roll-over system prices range from 150,000 to 400,000 riyals, while tunnel systems start from 600,000 riyals and may exceed one million.

Where to Buy Equipment?

Local purchase from Saudi Arabia provides the advantage of warranty, after-sales service, and technical support. Equipment is available at SACO for small and medium equipment, authorized Kärcher and Bosch agents, and specialized industrial equipment stores. Prices are slightly higher but warranty and service are worth the difference.

Importing from abroad provides lower prices but with some risks. China is the cheapest source through platforms like Alibaba, Made-in-China, and 1688, saving 30-50% off price but sea shipping takes 20-40 days, and quality and warranty risks exist. Germany and Italy offer the highest quality for advanced systems but at higher prices.

Important tip: For simple equipment like pressure washers, buy locally for warranty. For large systems, study importing carefully while ensuring a local maintenance agent exists.

Fifth: Labor and Cost Calculations

Labor is one of the most important elements of project success, especially in manual washes where service quality depends heavily on worker skills.

Types of Required Labor

The exterior washing worker is responsible for washing the car body exterior and tires. The interior cleaning worker specializes in cleaning seats, floors, and interior glass. The polishing and waxing worker performs polishing and scratch removal work. The engine cleaning specialist requires special experience to handle sensitive parts. The supervisor or manager is responsible for work management, customer reception, and accounting.

Worker Salaries

A beginner washing worker earns 1,500 to 2,000 riyals monthly. An experienced worker earns 2,000 to 2,500 riyals monthly. A supervisor or manager earns 3,000 to 4,000 riyals monthly.

Additional Costs for Expatriate Workers

Labor office fees are 800 riyals monthly or 9,600 riyals annually per worker. Medical insurance ranges from 500 to 1,500 riyals annually. Residence and renewal range from 500 to 1,000 riyals annually. Housing if not provided by the employer ranges from 500 to 1,000 riyals monthly.

Calculating Total Annual Cost Per Worker

Monthly salary of 2,000 riyals multiplied by 12 months equals 24,000 riyals. Labor office fees 9,600 riyals. Medical insurance 1,000 riyals. Residence and renewal 750 riyals. Total 35,350 riyals annually per worker, approximately 2,950 riyals monthly.

Sixth: Required Spaces

The required space varies according to the type of car wash and expected work volume.

Small Manual Car Wash

Minimum 30 square meters and ideal space 50 to 100 square meters. Suitable for residential neighborhoods and medium-density areas.

Medium Manual Car Wash

Minimum 100 square meters and ideal space 150 to 200 square meters. Accommodates 2-3 cars simultaneously with a waiting area.

Automatic Roll-over Car Wash

Minimum 80 square meters and ideal space 100 to 150 square meters. Requires entry and exit areas for vehicles.

Automatic Tunnel Car Wash

Minimum 200 square meters and ideal space 300 to 500 square meters. Requires tunnel length of at least 20 meters.

Parking Spaces

One parking space per 50 square meters of car wash area must be provided with a minimum of two spaces. Ideally 4 to 6 spaces to ensure smooth operations.

Seventh: Financial Feasibility Study

Here we present a detailed feasibility study for a medium-sized manual car wash as a model that can be adjusted according to your circumstances.

Setup Costs

One year advance rent 40,000 riyals depending on location. Shop preparations including flooring, drainage, and electricity 15,000 riyals. High-pressure washers 3 units costing 6,000 riyals. Vacuum cleaners 2 units 2,000 riyals. Polishing equipment 3,000 riyals. Water tank capacity 1000-2000 liters 2,000 riyals. Supplies including shampoo, wax, and cleaning materials 5,000 riyals as initial inventory. Sign and decor 5,000 riyals. Licenses and fees for commercial registration, municipality, and civil defense 5,000 riyals. Total setup costs 83,000 riyals.

Monthly Costs

Rent 3,500 riyals. Salaries for 3 workers 6,000 riyals. Expatriate labor fees 2,400 riyals at 800 riyals per worker. Electricity and water 1,500 riyals. Operating supplies 2,000 riyals. Maintenance 500 riyals. Total monthly costs 15,900 riyals.

Expected Revenues

Exterior wash: 20 cars daily multiplied by 30 riyals multiplied by 26 working days equals 15,600 riyals monthly. Full interior and exterior wash: 8 cars daily multiplied by 60 riyals multiplied by 26 days equals 12,480 riyals. Additional services including polishing, engine cleaning, and freshening 3,000 riyals. Total monthly revenues 31,080 riyals.

Net Profit and Payback Period

Monthly net profit equals revenues 31,080 minus costs 15,900 equals 15,180 riyals. Annual net profit 182,160 riyals. Return on investment rate approximately 84%. Capital payback period equals 83,000 divided by 15,180 equals approximately 5.5 months. These figures are estimates and vary according to location, service quality, and competition level.

Eighth: License Renewal and New Requirements

Commercial license renewal is done through the Balady electronic platform. Immediate or non-immediate renewal is possible depending on the activity and location. Requirements include valid commercial registration, no outstanding violations, and payment of due fees.

What Happens When an Old License Expires?

If the car wash is inside a fuel station and was manual, it must be converted to an automatic system upon renewal because manual washes are now prohibited in stations. If the car wash is independent outside stations, renewal is done with the same conditions while ensuring compliance with updated environmental and safety requirements. Some equipment upgrades may be required to comply with new standards.

Ninth: Success Factors and Challenges

Success Factors

Choosing a strategic location on a main street near residential or commercial neighborhoods with high vehicle density. Excellent service quality through using high-quality cleaning materials and properly training workers. Competitive pricing appropriate for the market while maintaining reasonable profit margins. Excellent customer service by providing an air-conditioned waiting room with WiFi and beverages. Monthly subscription system ensures steady income and builds a permanent customer base. Smart marketing through WhatsApp Business and Instagram and offering promotions for new and regular customers. Adding various services such as polishing, scratch removal, engine cleaning, and paint protection.

Potential Challenges

Intense competition due to numerous car washes especially in major cities. Managing labor and ensuring consistent service quality. High operating costs especially expatriate labor fees. Seasonal fluctuations as demand decreases during rainy seasons. Maintaining equipment and continuous maintenance costs.

Frequently Asked Questions

Is a car wash business profitable?

Yes, it is considered a relatively profitable business with the potential to achieve a return on investment of up to 84% and a capital payback period ranging from 6 to 18 months depending on management, location, and service quality.

How much does it cost to open a car wash in Saudi Arabia?

Costs vary by type. Manual car wash ranges from 80,000 to 150,000 riyals. Automatic car wash starts from 200,000 riyals and may exceed 600,000 riyals. Mobile car wash ranges from 50,000 to 120,000 riyals.

Must the car wash be inside a fuel station?

No, this is not a requirement. You can establish an independent car wash at any approved commercial location. However, if you want to establish one inside a fuel station, it must be automatic only.

What is the best car wash equipment brand?

Kärcher from Germany is considered the best worldwide in high-pressure washers. For automatic systems, WashTec from Germany is the best quality and Risense from China offers good value for money.

Can a foreigner open a car wash?

Yes, residents can open a car wash provided they obtain the necessary licenses and comply with applicable regulations.

What is the monthly income of a car wash?

A small car wash income ranges from 25,000 to 35,000 riyals monthly and may increase with larger car wash size and expanded customer base.

Conclusion

The car wash business is a promising investment opportunity in the Saudi market, especially with the continuous growth in vehicle numbers and increasing demand for vehicle care services. Success requires good planning, choosing the right location, investing in high-quality equipment, and hiring skilled labor. The new requirements prohibiting manual car washes inside fuel stations open opportunities for independent washes and push toward automation and development in this sector.

Start by studying the market in your target area, learn about competitors, calculate your costs accurately, and do not hesitate to seek advice from experienced people. With proper planning and good execution, this project can be an excellent source of income and a starting point for future expansions. Share this guide with those thinking of entering this field, and we wish you success in your project.