KU HOLDINGS CO.,LTD.

Business Details

The Domestic Car Sales business is a segment that provides retail sales and repair services for domestic new and used cars (including minivehicles/kei cars). The company promotes store deployment across a wide area centered on the Greater Kanto region, and adopts a group collaboration model that allocates used cars procured within the group to optimal sales channels. It also conducts quality inspection and resale of used cars purchased from customers, and accepts outsourced repair work, providing total car-life support including after-sales service following purchase. The business operates in an environment of intensifying competition with domestic manufacturer-affiliated dealers and large-scale car-buying specialist chains.

Recent Overview

Revenue rose 2.0% year on year, but operating income fell sharply by 18.2%

In the Domestic Car Sales business for FY2026 (ending March 2026), revenue increased to ¥52,179 million (up 2.0% year on year), while operating income fell sharply to ¥2,157 million (down 18.2% year on year). Rising cost of sales and increased selling, general and administrative expenses (due to inflation and higher labor costs) appear to have squeezed profits. While the domestic new car market contracted 0.9% year on year, the company grew revenue by capturing the slight increase in the used car market (up 0.6% year on year), but was unable to fully absorb the cost increases.

Key Products

Growth Drivers

• Expansion of used car sales by capturing the gradual increase in domestic used car registrations (6.49 million units in FY2026, ending March 2026, up 0.6% year on year)
• Solid growth in repair and after-sales service revenue (up 8.6% year on year across the group as a whole)
• Promotion of store deployment across a wide area not limited to the Greater Kanto region
• Improved earnings efficiency through intra-group used car distribution and outsourced repair work
• Strengthened earnings structure through productivity improvements via active IT investment

Risks

• Declining profit margins due to rising vehicle and raw material costs from inflation and increased labor costs (operating margin deteriorated significantly in FY2026, ending March 2026)
• Intensifying competition from domestic manufacturer-affiliated dealers expanding aggressively into the used car market and large-scale car-buying specialist chains
• Structural market contraction due to the declining birthrate and younger generations moving away from car ownership (domestic new car registrations fell 0.9% year on year)
• Risk that prolonged tensions in the Middle East accelerating oil price increases and yen depreciation could impact personal consumption and corporate earnings
• Risk of reduced personal consumption due to price increases