Chinese electric vehicle maker BYD on Wednesday unveiled its kei minicar specifically designed for the Japanese market, as it aims to grow its presence in the country, where EVs have not been as popular as in China.
The kei minicar is Japan's own category of vehicles that meet certain size and engine displacement standards. The category accounts for more than 30% of the country's vehicle sales, as the cars work well with Japan's narrow roads and the lower taxes placed on the vehicles make them more affordable than larger cars.
BYD debuted the Racco kei model at the Japan Mobility Show, the country's largest auto show, which opened to the media on Wednesday and runs through Nov. 9.
"We developed the Racco to meet Japan's kei minicar standard, and it is BYD's first model designated exclusively for an overseas market," BYD Auto Japan President Atsuki Tofukuji said at a news conference on Wednesday.
Racco sales are slated to begin next summer. Tofukuji noted that two types -- a short-range model and a long-range model -- will be available. Prices, battery capacity or cruising range per charge were not disclosed.
BYD's first kei vehicle falls into a subcategory known as a "super height wagon," which has a wide interior space and a greater height than regular kei cars. The vehicle includes various features that are popular in Japan, such as sliding doors.
"Since its commercialization was decided last fall, this vehicle has been developed rapidly in the BYD style, with over 100 prototype vehicles already built," Tofukuji said.
In Japan, EVs are still a relatively small segment of the auto market. BYD says it aims to change this with the Racco. According to Tokyo-based automotive research firm MarkLines, the share of EV sales in the country was just 2% in September. Meanwhile, in Norway it's 82%, one of the highest in the world. In other Asian countries, EV shares were 56.3% in China, 22.9% in Thailand and 18.9% in South Korea.
BYD entered the Japanese market in 2023 with its medium-sized electric Atto 3 SUV and has gradually expanded its sales network, selling a total of 7,123 units as of September. The company has a plan to collaborate on sales with Aeon, a major retail group in Japan, for a limited period.
BYD's kei debut is also expected to spark fierce competition among Japanese domestic kei minicar manufacturers, such as Suzuki Motor, Honda Motor, Nissan Motor, Mitsubishi Motor and Daihatsu.
Honda in September unveiled a new electric kei that features the longest driving range in its class, while Nissan in August launched its latest Roox kei. Mitsubishi Motors is showcasing the new Delica mini kei at the Japan Mobility Show.
Suzuki President Toshihiro Suzuki, says he welcomes BYD's kei development.
"I'm very glad that [BYD] chose Japan's kei minicar specification among various small car categories," he said at a Japan Automobile Manufacturers Association press conference last week. "A new competition begins. I want to partake in it through mutual encouragement and friendly rivalry."
But Suzuki also warned that this rivalry "should not be a price competition." BYD is expanding its overseas business as chronic overcapacity in China has sparked fierce price competition.
"If you look at the situation of solar panel [makers] in China [for instance], who actually benefited from a race that did not see prosperity? Even top makers are stuck in a scheme where they can't secure profits," he said.
Suzuki also noted that the market barrier for accepting products that are made in China or South Korea -- not just BYD -- "has dropped significantly."
"It would be great if it leads to everyone working to promote the adoption of EVs while ensuring a thorough understanding of the products," he said.