Tesla’s Popularity In Japan & Its Future EV Market
EVs account for only 1% of Japan’s overall car sales — in 2021, new registrations of EVs imported to Japan topped out at 8,610. Yet it was Tesla’s popularity that carried the momentum, as it sold more than 5,200 cars in Japan last year, up from about 1,900 in 2020. Importantly, the US all-electric car manufacturer is capturing more and more of the market share among Japan’s young and wealthy.
Japan boasts a high per-capita income and enthusiasm for high-end European cars such as Mercedes-Benz, so an emerging hunger for Teslas is a signifying move for that country’s early adopters. Japan has been relatively slow to embrace EVs, says the Japan Times, partly due to a lack of charging stations, EV-dedicated parking spaces, and sufficient subsidies — plus the vehicles tend to be more expensive than gasoline cars.
Japanese Automakers Responsible for Slow National EV Transition
With Japan’s historical hold on hydrogen fuel cell vehicles and conventional hybrid vehicles, EVs there seemed more abstract than an indicator of the future.
Hydrogen is vital for certain industrial processes, notably the production of ammonia, the main ingredient in (climate poisoning) artificial fertilizers. Hydrogen used for these purposes can be sourced from renewables (so-called “green hydrogen”) rather than from fossil fuels that are mostly used today. Yet, as has become clear, as a transportation energy storage medium, H2 is far less efficient than batteries (22% well-to-wheels, compared to 73%, by one analysis). Delivering it would require building a vast new infrastructure. The advantages of fuel cell vehicles — longer range and fast fueling times — have rapidly been eroded by improving battery and charging technology.
Moreover, the push that began about 25 years ago toward hybrids like Toyota’s Prius has proven to be the ultimate wrong call, setting Japan behind much of the world in EV production. Toyota has since committed 8 trillion yen ($69 billion) on electrification up to 2030 and expects to sell around 3.5 million battery EVs worldwide by then, according to Reuters. That represents around a third of Toyota’s current annual auto sales.
In 2014, when Tesla was introduced to Japan, the country’s closed market of 3 large automakers had little interest at all in electric cars. The only exception was Nissan.
The Nissan Leaf emerged in Japan over a decade ago and seemed to be a revolutionary EV for the masses, with more than 500,000 sold by the end of 2020. Yet Japan’s position was to leverage its huge investment in hybrid technology for as long as possible. That short-term focus, however, has left the country’s most important industry at risk of missing a transformative moment, Masato Inoue, the original Leaf’s lead designer, told the New York Times. “When disruption happens, there’s always fear,” said Inoue, who retired from Nissan in 2014. But, ready or not, he added that “a big wave of electric vehicles is really coming.”
Toyota Motor’s first all-electric mass-market model will not be sold to consumers in Japan when it rolls out later this year, as the automaker focuses on bigger markets with more established demand for electrics. Nikkei Asia reports that the bZ4X sport utility vehicle, the first model to come out under the new electrics strategy outlined by the automaker in December, will be offered to consumers through the Kinto subscription service from May or June at the earliest.
Under a plan provided to suppliers in late January, Toyota will begin production in April, targeting just under 60,000 units worldwide in fiscal 2022 — more than the 14,000 electric vehicles it sold in 2021. It aims to make about 50,000 units in fiscal 2023. Less than 10% of total production is expected to go to the Japanese market. Most will go to North America and Europe, where strengthening environmental regulations have given rise to intensely competitive electric vehicle markets.
Toyota has revealed that the bZ4X will start at 41,950 pounds ($56,900) in the UK.
Tesla’s Popularity in Japan, Hybrids’ Weakening Hold
Globally, Tesla delivered over 936,000 cars last year, an 87% increase from the year before, despite supply chain obstacles. Tesla is incrementally boosting its brand recognition in Japan, with the result that Teslas have become a status symbol to consumers who live in urban areas where they can access EV chargers. As part of the company’s appeal to the Japanese market, Japanese consumers saw a 24% decrease in the price of a Model Y a year ago; the 5 million yen reduction paralleled a discount in China.
Tesla’s charging stations are concentrated in metropolitan areas. The company has not remarked about the number of chargers it will build in Japan this year but is currently looking for a charging stations project deployment manager, according to its website.
In 2010, Tesla shipped a dozen Japan Signature Series Roadsters from Port Hueneme, California, to Yokohama for delivery to select customers. That targeted delivery was concurrent with the Tesla announcement that it had formed a partnership with Panasonic to accelerate the development of next generation EV cells. “With its combination of high-level car enthusiasts and interest and appreciation of cutting edge technology, Japan is a natural market for the Roadster,” said Tesla CEO Elon Musk said at the time. “The Tesla Roadster is a no-compromise (dakyo no nai) vehicle that makes no sacrifices on performance, design, or engineering.”
At that time, the Japanese government had hoped to reduce carbon emissions 25% by 2020. Among other “soft” barriers to importing Teslas to Japan was the requirement that each individual vehicle imported for sale in Japan needed to be inspected to ensure it complied with Japanese regulations.
Fast forward to 2022. The Japanese government has pledged to be carbon neutral by 2050 and intends to nearly halve emissions by 2030 from 2013 levels. Gas-fueled cars will be banned by the mid-2030s. The country has also made EVs more affordable for consumers, doubling the amount of subsidies to a maximum of 800,000 yen ($7,000).
At the same time, Tesla opened its first delivery center in Japan in 2021. IHS Markit estimates forecasts a brief pause for Tesla sales this year while potential buyers wait for the new Model Y, which is expected to become available in Japan around year-end.
The love affair with Tesla is sure to continue, though, as the allure of the brand has been accentuated through its embrace from Japan’s pop culture icons.. One of Japan’s Major League Baseball players, Shohei Ohtani, proudly shows his Tesla love. Japanese pro surfer Akira Shindo has expressed good vibes about driving his Tesla. Tesla’s popularity is clear through pop group Perfume, which foregrounded Tesla in its video (below).
Have a tip for CleanTechnica? Want to advertise? Want to suggest a guest for our CleanTech Talk podcast? Contact us here.
Sign up for our daily newsletter for 15 new cleantech stories a day. Or sign up for our weekly one if daily is too frequent.
CleanTechnica uses affiliate links. See our policy here.
CleanTechnica's Comment Policy
