Company history

Nextage began in rejection. In 1996 Hirota Yasuharu, then twenty-three, quit selling water heaters and tried to move into car retailing; the dealers turned him down because he had dropped out of high school. So he started for himself, as a sole trader called Auto Stage Hirota, in Owariasahi — the small Aichi town he had grown up in — and incorporated it in December 1998 with capital of $22,920 (¥3m).

The used-car trade he entered was lopsided. On the buying side Gulliver International (later IDOM) was building a national chain; on the selling side thousands of small local lots competed on nothing in particular. Hirota reasoned that he could not win on the crowded main road, so he took a lane almost nobody was in: used Volvos only. A specialist in a rare category pulls buyers from the whole country rather than the neighbourhood, and narrowing the model range steadied both what he could source at the USS auctions and what he could charge. In December 2000 he opened a first proper store of about 500 tsubo (roughly 1,650 m²) in Nagoya, with the stated ambition of not ¥1 billion in sales but ¥10 billion.

Once the single-marque store had proved it could earn on its own, he broadened it. A Nextage store opened in Kasugai in 2002 selling domestic Subarus, taking the format beyond imports; the operating company was converted to a joint-stock company the same year, and in December 2004 the two entities were merged and the group settled on one name — Nextage.

By the mid-2000s used-car retailing had become a look-alike business and the margin on the car itself was being squeezed out. In November 2005 Hirota answered that not by cutting prices but by moving the profit: under the name cross-selling, he built inspection, insurance, bodywork and coating into the store, so that the gross profit on one customer accumulated across the years until they traded the car in. A thinning margin on the metal would be made up on the margin of everything attached to it. This was the origin of the lifetime-customer model that later carried the company's returns.

The expansion nearly ended it. Nextage entered the Kansai region in August 2008 and started exporting used cars that October; the Lehman shock landed the month in between. In a business where vehicle inventory is worth more than a third of annual sales, a sudden collapse in demand brings write-downs and lost sales at the same time, and the industry filled with failures. Nextage's equity ratio fell to the mid-teens and insolvency became a live question. Hirota did not retrench: he kept opening stores — Kyushu in 2009, the Kanto region in 2010 — while rebuilding the balance sheet, took the title of president and CEO in February 2010, and in August 2010 opened a central PDI centre in Komaki so that inspection and refurbishment quality was set by head office rather than by each lot.

What followed made the company a group rather than a chain of shops: door-to-door used-car buying without stores from 2011, a coating subsidiary the same year, so that buying, selling, inspection, bodywork, coating and insurance all sat inside one organisation. Sales went from $354.7M (¥28bn) in the year to November 2012 to $407.8M (¥40bn) a year later, and Nextage listed on the TSE Mothers market in July 2013 — fifteen years after incorporation. Fourteen months after that, in September 2014, it moved up to the First Section, a jump no used-car retailer had made at that speed. Hirota promptly published a "2020 Vision" of 200 stores and ¥200 billion in sales, and described the goal as becoming "the manufacturer of used cars" — a chain that sets the industry standard on price, quality and service.

From 2015 Hirota doubled annual capital spending and pushed the store format past 1,000 tsubo (about 3,300 m²). The logic rested on one stubborn fact about the trade: however far e-commerce advanced elsewhere, people still wanted to stand next to a used car before buying it, so the number of cars on a single lot translated fairly directly into traffic and sales. A January 2015 store in Nagoya was built as the prototype — sales, trade-in, inspection and after-service under one roof for the life of the customer — and an SUV-only experience store that August established the big-box format as a category of its own.

The money came from the banks. Capital expenditure rose to about $50.7M (¥6bn) in the year to November 2018, land and buildings were bought outright, and $166.7M (¥18bn) was borrowed in that single year. The equity ratio fell from 42.5% to 28.2% — the visible price of buying growth on leverage. Sales followed: $1.1B (¥119bn), then $1.5B (¥163bn), roughly six times the level at listing five years earlier, with about three times the stores and a network now covering nearly every region of Japan.

The two designs then compounded. Big stores widened the inventory and put more attached services in front of each buyer, so cross-selling worked harder per customer: operating margin reached 4.7% in the year to November 2021 — close to double the main listed used-car rivals — on sales of $2.7B (¥291bn). Nextage also began moving upstream into new-car franchises, taking Volvo, Jaguar Land Rover and, through an acquisition in 2018, Audi dealerships. In February 2022 Hirota handed the presidency to Hamawaki Koji, a Big Motor veteran who had joined as vice-president in 2016, and moved to chairman and CEO. A pandemic shortage of new cars pushed used demand higher still, and the year to November 2022 set records: $3.2B (¥418bn) in sales and $147.7M (¥19bn) in operating profit.

In July 2023 Big Motor was found to have padded insurance claims, and the whole used-car industry's credibility went with it. By August Nextage had found its own improper cases — fabricated motor-insurance contracts — and disclosed them on 1 September. Ten days later Hamawaki resigned, and Hirota, then fifty, took back the presidency while remaining chairman.

His response went past the resignation to the mechanism. Pay tied to contracts written and add-ons sold drives a sales floor hard, and past a certain point it drives it away from the customer; so he abolished every incentive and rebuilt compensation around fixed salary — an unusual step in a trade where commission is the norm, and one that removed the very lever his own cross-selling model had been built to pull. The store network was put through the same selection: mid-sized domestic stores consolidated, some new-car dealerships sold off. The year to November 2023 still grew sales 10%, to $3.3B (¥463bn), but operating profit fell 16% and the margin slipped from 4.6% to 3.5%; by the year to November 2024 it was down to 2.3%.

The rebuild then showed. Sales in the year to November 2025 reached $4.4B (¥652bn) with operating profit up 51.5% and the margin back to 3.0%, on a store count up eleven year-on-year even after closures. In April 2025 a store in Tokushima completed coverage of all forty-seven prefectures — a national network finished twenty-nine years after a rejected job applicant opened a used-Volvo lot. Against that, the long-range goal set in 2022 of ¥1 trillion in sales and a 5% share of the domestic used-car market by 2030 stands roughly two-thirds complete, and the question the founder returned to answer is still open: whether a business designed to earn on the lifetime of a customer can hold its selling energy without paying for it.