ENVALITH
株式会社ゼロ logo

ZERO CO.,LTD.

9028・Standard Market・Land Transportation

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株式会社ゼロ logo
ZERO CO.,LTD.9028

Business

Zero Co., Ltd. was established in 1961 as Nissan Rikuso, wholly funded by Nissan Motor, and became independent following an MBO in 2001. It currently operates four segments centered on the Domestic Automotive-Related Business (new and used car transport): the Human Resources Business (driver dispatch and transportation services), the General Freight Business (port cargo handling and 3PL), and the Overseas-Related Business (used car exports and China vehicle transport). The group comprises 21 subsidiaries and 3 jointly controlled companies, and belongs to the Hong Kong-listed Tan Chong International Limited Group. Its major customers include Nissan Motor (8.7% of sales) and other finished vehicle manufacturers and automobile dealers, and its strength lies in its nationwide network for land and sea transport.

Business Model

The Domestic Automotive-Related Business (revenue of ¥69,519 million) is the core business, accounting for approximately 47% of the total. Its structure improves profitability through sales activities emphasizing gross profit via rate optimization and securing return cargo. The Human Resources Business secures stable labor-provision revenue through driver dispatch, transportation services, and airport staffing. The General Freight Business achieves high profit margins in port cargo handling and 3PL, areas with high barriers to entry. In the Overseas-Related Business, used car exports to Malaysia (revenue of ¥48,760 million) function as a second pillar.

Company Strengths

Between 2015 and 2017, the company completed the regional block reorganization of its transport network, consolidating a total of 14 companies—Zero itself, 7 transport subsidiaries, and 6 partner companies—into 5 nationwide blocks. The land and sea transport network capable of handling long-distance transport forms an entry barrier that competitors cannot easily replicate, and revenue from the Domestic Automotive-Related Business reached ¥69,519 million in FY2025 (ended June 2025).

Since January 2024, the company has implemented phased increases in transport fees for new and used cars. Combined with sales activities emphasizing gross profit (reducing empty-vehicle legs by securing return loads), the cost of sales ratio declined from 87.4% in the previous fiscal year to 85.3% in FY2025 (ended June 2025). Operating profit improved substantially, increasing 164.4% year-on-year from ¥6,222 million in the previous fiscal year to ¥10,228 million, with the operating profit margin of 6.9% exceeding the medium-term management plan target of 6.5%.

Used car exports to Malaysia through subsidiary World Windows have remained solid, with the number of used passenger cars exported increasing to 101.6% year-on-year. Revenue from the Overseas-Related Business reached ¥48,760 million, accounting for approximately 33% of total revenue. Through collaboration with the Tan Chong Group's Asian automotive distribution network, the company has established a business foundation in the ASEAN region.

ENVALITH's Perspective

The full-year forecast for FY2026 (ending June 2026) (revenue ¥145,000 million, operating profit ¥10,300 million) remains unrevised. However, 3Q cumulative revenue of ¥111,925 million (progress rate 77.2%) and operating profit of ¥7,503 million (progress rate 72.8%) both declined slightly year on year, down 1.0% and 2.8% respectively. Approximately ¥2,800 million in operating profit is still needed in 4Q (April–June 2026), a level that must exceed the prior-year 4Q result (approximately ¥2,511 million). Whether the second half can make up the shortfall is key to achieving the full-year target.

Segment profit for the Overseas-Related Business fell to ¥398 million on a 3Q cumulative basis (53.0% of the prior-year same period), a near-halving decline. In the used car export business to Malaysia, the resumption of AP issuance advanced the shipment of vehicles that had been backed up domestically, but congestion at local port facilities caused vessel delays and shipping slot restrictions. The China Vehicle Transport Business also saw a decline in revenue per unit due to contract renewals, compounding external and structural factors. The timing of a recovery in this segment's profit margin will determine the extent of any upside in overall performance.

Multiple cost-increase factors are progressing simultaneously, including the increase in driver salary levels (higher labor costs) effective from July 2025, rising system costs associated with digitalization and aging system upgrades, costs to build a division-of-labor structure to address the 2024 problem, and rising career car (vehicle transport carrier) maintenance costs including extraordinary maintenance work. These are unavoidable as future investments and structural responses, leaving limited room for near-term margin improvement. Corporate income tax expense also increased to ¥2,405 million on a 3Q cumulative basis (versus ¥2,233 million in the same period of the prior year), with a rising effective tax rate also weighing on net profit.

Growth Strategy

Medium-term plan targets for FY2027 (ending June 2027): Revenue of ¥150,000 million or more, operating profit of ¥10,000 million or more, and ROE of 14% or more

The strategy of offsetting the decline in new car transport with used car transport bore fruit in 3Q standalone, with transport volume turning to a year-on-year increase. Unit price increases driven by gross profit-focused sales activities also continued, resulting in revenue for the Domestic Automotive-Related Business turning to growth at 101.3% year-on-year for the cumulative 3Q period.

The expansion of vehicle maintenance operations through the consolidation of Zero Plus Maintenance Co., Ltd. as a subsidiary (March 2025), along with the commencement of contracted on-site operations at USS Tokyo and USS Yokohama (January 2026), contributed to the growth of the Automotive Ancillary Business, which in turn contributed to the revenue growth of the Domestic Automotive-Related Business.

The resumption of AP issuance in Malaysia in January 2026 has advanced the shipment of vehicles that had accumulated domestically. However, congestion at local port facilities has caused vessel delays and shipping slot restrictions, and shipments have not yet fully normalized. Cost reduction efforts are continuing.

The advancement of fee revisions for low-profitability sites in the Transportation Service Business (Vehicle Operation Management), along with the review of recruitment and follow-up systems, has increased new contract acquisitions. The centralization of vehicle transport driver recruitment has also increased the number of dispatched personnel within the Human Resources Business. Cumulative 3Q segment profit reached ¥754 million (109.2% year-on-year), achieving profit growth.

System costs are increasing due to the promotion of digitalization and responses to system aging, and the company is currently in an investment phase. In parallel, efforts are underway to build a division-of-labor system (such as advance preparation for loading onto car carriers) to reduce drivers' working hours. While this is a cost-increasing factor in the short term, the aim is to achieve medium-term productivity improvements.

Last updated: July 17, 2026