Gasgoo News In the Japanese automotive market, a long-neglected niche segment is quietly becoming a new battlefield for electrification transformation—Mini Cars (Kei Car). This Japan-exclusive vehicle category, with its lower price and tax fees, and the convenience brought by smaller dimensions, has long accounted for about 40% of new car sales in Japan. Since it is mainly used for short urban commutes and family transportation, the range requirements are relatively low, so Japanese mini cars are naturally suitable for electrification transformation. Today, with the entry of Chinese car companies and the strategic shift of Japanese local car companies, the Japanese mini car market is accelerating its transition from the fuel era to electrification.

BYD and Chery Bet on Japanese Electric Mini Car Market

Last October, BYD showcased a boxy four-door pure electric mini car named Racco at the Japan Mobility Show in Japan, and announced that this model would officially launch in Japan this summer. This is BYD’s first electric mini car built specifically for the Japanese market.

BYD Racco; Image Source: BYD

It is reported that the Racco model offers 3 versions, with the entry-level version having a range of about 200 km, and the other two versions having a range of 300 km. Racco strictly follows Japanese mini car standards and is equipped with sliding doors for the first time on such pure electric vehicles to better adapt to narrow streets and parking environments in Japanese cities. At the same time, the new car will also provide richer assisted driving functions.

BYD also plans to rapidly expand its sales network in Japan by opening numerous micro stores that display only one or two models. Atsuki Tofukuji, President of BYD Automotive Japan, stated: “We plan to cover local small commercial circles to sell micro electric vehicles.” These stores will be located in remote cities with a population of less than 500,000, displaying at most a few exhibition cars per store, with a faster store opening speed. BYD’s micro stores will feature Racco as the core recommended product.

Following BYD, Chery Motors also plans to launch a pure electric mini car in Japan next spring. Chery will join forces with four partners to jointly create a new electric brand EMTA, and has already established the operating company EMT in Yokohama, Japan, responsible for vehicle R&D and sales work. The CEO of EMT said in an interview recently: “This brand is built for Japanese consumers, aiming to create a more convenient and comfortable way of travel for the public.”

EMT belongs to a Singapore joint venture. The joint venture is led by Chery, while the other four cooperating enterprises are China Jiangsu Yueda Automobile Group, power battery manufacturer Gotion High-Tech, and Japanese automotive supplies retailer Autobacs Seven, and painting equipment company Anest Iwata.

This light vehicle is jointly developed by China and Japan. It will initially be produced in China, and core functions such as driving assistance all adopt Chery technology.

EMT Company Chief Marketing Officer Susumu Uchikoshi stated that the new car pricing will benchmark against fuel-powered mini cars of the same class. It is reported that the sales price of Honda N-Box fuel mini cars, which are very popular in the Japanese market, is 1.74 million to 2.48 million yen (approximately 10,915 to 15,560 USD). 

Image Source: EMTA

According to the plan, EMT will start with this pure electric light vehicle and launch four electric vehicle models in Japan before 2029. Autobacs will rely on its own offline store network to assist in vehicle sales.

After the launch of this electric light vehicle, EMT plans to build 100 stores integrating sales and after-sales in Japan, and continue to expand channels, striving to increase the store scale to hundreds by the 2027 fiscal year. The CEO of EMT Company stated: “Japan is our most important market, and the brand new European mini electric vehicle standards have also brought new opportunities for the brand’s global development.”

Japanese Car Companies Accelerate Mini Car Electrification Layout

With Chinese car companies accelerating their layout, Japanese local car companies are also actively promoting electric mini car products and market planning.

Honda’s electrification pace is the most eye-catching. Its N-Box mini car is the absolute king of the Japanese market. Sales broke through 200,000 units in 2024, ranking first in sales for three consecutive years. Honda launched the N-One e: pure electric mini car last September. The group will also launch the pure electric version of the N-Box model in 2028. Currently, the range and pricing of the electric N-Box model are still in the final confirmation stage. Besides the electric version, Honda is expected to continue selling the fuel version of the N-Box model.

N-One e; Image Source: Honda

Nissan officially launched the revised model of its Sakura electric mini car in April this year, aiming to maintain its competitiveness in the Japanese electric mini car market. The Nissan Sakura model was initially launched in 2022 as the mass production version of the IMk concept car and has continuously become the best-selling electric mini car in Japan in recent years. According to data released by Nissan, the sales of this model reached 14,093 units in the full year of 2025, ranking first in this sub-market for four consecutive years. It is reported that the sales of the two electric mini car models, Nissan Sakura and Mitsubishi eK X, in 2024, accounted for more than 40% of the total sales of electric vehicles in Japan.

In addition, Suzuki Motors plans to launch its first electric mini car within this fiscal year. Daihatsu also launched an electric mini commercial vehicle jointly developed with Toyota in February this year. Japanese local brands are building a deep moat using their huge channel advantages (Daihatsu alone has about 700 regular stores; if small outlets are included, it reaches 6,000).

Currently, in the Japanese new car market, the proportion of electric vehicles is only about 2%, ranking last among developed countries. Insufficient number of charging piles and high vehicle prices are the main constraints. High cost-performance electric mini vehicles are expected to improve the local electric vehicle penetration rate. Since mini cars are mainly used for short-distance travel, range requirements are not high, which fits very well with the positioning of pure electric vehicles. Seiji Sugiura, a senior analyst at an automotive market analysis institution, said: “Pure electric mini cars do not need to reach the range level of conventional passenger cars. As long as the pricing is reasonable, electric light vehicles are expected to quickly occupy the market.”

However, for BYD and Chery, the real test lies not only in launching a mini electric vehicle priced to benchmark the N-Box, but also in how to eliminate Japanese consumers' brand concerns over time, and how to maintain the balance between price and quality under the local advantages of Toyota, Honda, and Suzuki. This battle of pure electric mini cars may be the key battle for Chinese car companies to truly open the door to the Japanese market.

According to media reports, Chery is establishing a joint venture with multiple Chinese and Japanese enterprises to launch an independent all-electric brand in Japan. Instead of following Chery's traditional direct overseas model, the new venture adopts a strategy of "Chinese Technology + Japanese Local Operation".

This is a result of a five-party cooperation, including: Chery Automobile, which provides vehicle platforms, electric powertrains, and core intelligent driving technology, while serving only as a shareholder without participating in local Japanese operations; Jiangsu Yueda Group, which utilizes the former HiPhi factory in Yancheng to handle vehicle production; and Gotion High-Tech, which is responsible for supplying power batteries.

The Japanese side is mainly responsible for channels, craftsmanship, and localization. Autobacs Seven, Japan's largest automotive aftermarket retail chain with approximately 1,200 stores, manages sales, after-sales service, and localized brand operations. Anest Iwata, a prominent leader in industrial painting equipment, provides specialized technical support for the vehicle's body-painting and finish processes.

The operating entity's parent company is registered in Singapore, with a subsidiary EMT (Electric Mobility Technologies) established in Yokohama, Japan, to fully operate the new brand, R&D, and sales.

Positioned as an all-electric brand originating from Japan, the new venture has built a world-class team, recruiting technical talent from Honda and Mazda alongside a former Nissan executive serving as Chief Marketing Officer (CMO).

In terms of product planning, the first all-electric model is scheduled for delivery in Japan in 2027, focusing on the compact and subcompact EV segments to adapt to Japanese urban driving needs. By 2029, the company aims to launch four distinct models covering subcompact cars, SUVs, and MPVs. Looking beyond 2030, it plans to explore building localized factories in Japan.

Chery Automobile's overseas expansion strategy dictates that its vehicles utilize Chery's proprietary technology and are Made in China, while carrying a new brand identity tailored for the Japanese market. Direct utilization of AUTOBACS's nationwide stores bypasses heavy overseas retail construction costs, enabling rapid network scalability. This joint venture allows Chery to precisely target Japan's electric vehicle vacuum, created by the slower electrification pace of legacy giants like Toyota and Honda. Capitalizing on this massive market gap, Chery is well-positioned to leverage its technological edge and local partnerships to seize a powerful first-mover advantage—an expansion strategy that holds immense promise.

According to data from the Japan Automotive Importers Association (JAIA), total New Energy Vehicle (NEV) sales in Japan reached 16,924 units in March 2026, with BYD capturing a 3.7% market share. Notably, within the imported EV segment, BYD secured a dominant 10.3% share, ranking first among all imported all-electric vehicles. Driven by this momentum and upcoming market entries from other Chinese brands like GAC Aion and Zeekr, annual sales of Chinese NEVs in Japan are projected to surpass 20,000 units by 2027.