The Advantages and Precautions of Starting a Used Car Trading Side Business ~2025 Latest Edition~

The used car market in 2025 maintains a solid foundation with 544,174 registered units, but is in an adjustment phase where prices for 3-5 year old vehicles have dropped an average of 6% from their peak. Meanwhile, overseas exports reached 1.56 million units, setting a new record for the second consecutive year, creating an environment where high profitability can still be expected depending on sourcing routes and vehicle selection.

This article covers the complete picture of used car buying and selling as a side business with the following structure.

As of April 2025, the USS average contract price is 1.184 million yen, down 7.6% from the February peak, and inventory turnover has slowed to 61.9%. Meanwhile, exports reached a record high of 1,566,621 units, up 2% year-over-year, centered on UAE and Russia, with high-year SUVs and minivans maintaining demand driven by the weak yen.

This polarization of "softening domestic prices × strong foreign demand" represents a major opportunity for individual resellers who can shift capital from struggling sedans and kei cars to high-turnover vehicles.

In the U.S., the average used EV price dropped 29.5% in one year, falling below gasoline vehicles for the first time. In Japan, price adjustments are also progressing for vehicles like the Leaf and i-MiEV, and if you can assess remaining battery capacity, there's room to "buy cheap and flip domestically in the short term" or "profit from parts."

Used car reselling offers the following advantages.

Even as a side business, a secondhand dealer license is mandatory if buying and selling for profit on a continuous basis. Operating without a license carries penalties of up to 3 years imprisonment or a fine of up to 1 million yen.

The application fee is 19,000 yen, with a review period of 40-60 days. In addition to residence certificate, identification, and resume, documents proving usage rights for the business location and URL documentation (for online sales) are required, so advance document preparation is key.

If miscellaneous income outside of salary exceeds 200,000 yen, tax filing is required. For used car reselling, purchase cost, transport fees, title transfer fees, photography costs, etc. can be deducted as necessary expenses, and blue tax returns allow deductions of up to 650,000 yen.

In private sales, failure to complete title transfer leaves the seller with automobile tax bills and accident liability risks. Prevent trouble by specifying "title transfer completion deadline" and "late fees for delays" in the contract and ensuring proper delivery of transfer certificates and power of attorney.

The used car market in 2025 sees simultaneous softening of domestic prices and export expansion, making "selection and focus" extremely important for individual side business players.

The market environment will continue to shift significantly with the expansion of online sales, plummeting used EV prices, and penetration of subscription-based leasing. By following this article's roadmap and legal points while nimbly adapting to changes, side business used car sales will remain an attractive cash engine in 2025 and beyond.