Motor Vehicle Towing
Industry: Motor Vehicle Towing
Naics: 488410
Private Company Multiples
Industry Overview
The automobile trucking services industry has experienced significant changes over the past five years, influenced by shifts in population, traffic patterns, and economic conditions.
Industry revenue has climbed at a 2.4% CAGR, reaching $12.5 billion by 2024. However, a slight decline of 0.1% is expected in 2024. Industry profit, measured as EBITDA, is projected to account for 9.2% of revenue in 2024.
Car sales and ownership directly impact the performance of automobile towing services. High interest rates have curbed new car sales, leading to an increased number of older, breakdown-prone vehicles on the road. Despite the trend towards higher reliability in newer vehicles, the prevalence of older cars has maintained a steady need for towing services.
The proliferation of advanced vehicle technologies like autonomous driving and enhanced safety features is expected to gradually reduce collision rates, potentially dampening demand for towing services.
Looking ahead, automobile towing companies are likely to see more muted demand. Both new and used car sales are anticipated to increase as interest rates stabilize, disposable incomes rise, and fuel prices decrease. Collisions are expected to become more common as road congestion increases, maintaining steady demand for towing.
Towing companies are expected to modernize their fleets, potentially adopting electric vehicles to boost efficiency. This shift towards more environmentally friendly and cost-effective operations could position these companies advantageously as consumer preferences shift towards sustainability.
However, rising fragmentation in the industry is expected to intensify competition and put downward pressure on prices. Overall, industry revenue is projected to grow at a 0.9% CAGR, reaching $13.1 billion through 2029.
Key Financial Metrics
Income Statement Benchmark
