Chinese automaker BYD (BYDDY) stock was down today despite targeting a huge $18 billion mini-car opportunity in Japan.
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Popular Minicars
The EV maker is said to be planning to release a low-cost battery-powered kei car in Japan in 2026. These are lightweight minicars that are popular with Japanese people driving in congested urban areas and offer lower prices both to buy and insure.
The sector was worth around $18 billion in sales in Japan last year and accounts for 40% of the overall car market.
It is a market currently dominated by traditional automakers Honda (HMC), Nissan (NSANY), Toyota (TM) and Mitsubishi (MUFG). Now BYD wants to muscle in on the small-sized sector.
In an interview with the Financial Times, Atsuki Tofukuji, president of BYD Auto Japan, said he saw an opening for EVs in the market as high taxes push up fuel prices and the number of gas stations diminishes.
He said kei cars fit the Japanese lifestyle well and even compared them to the classic Austin Mini Cooper driven by Rowan Atkinson’s awkward comedy character Mr. Bean.
Chinese Distrust
Few details about the car such as its driving range, appearance and price have been unveiled. However, whatever the design, it might struggle to gain traction with the Japanese public.
That’s because, according to local industry experts, Japanese drivers tend to be rather loyal to their own automakers and are slightly distrustful of Chinese brands.
The shift from gas to electric is also struggling to get out of first gear in Japan with fewer than 60,000 sales of EV cars in 2024. That equates to just over 1% of the overall market.
But BYD is unlikely be pushed off this particular road. It is seeking to dominate overseas markets, with a target to sell half of its vehicles outside the Chinese market by 2030.
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