BYD mini-car plan may be wake-up call for Japan

BYD's Japanese mini-car will not go on sale until the end of next year, but it has already created buzz - at least among officials in Tokyo worried about the challenge from China's biggest automaker.

- MAKI SHIRAKI YOSHIFUMI TAKEMOTO DANIEL LEUSSINK

A Japanese kei-car among palm trees in Beppu, Kyushu, Japan.

(REUTERS)

The company plans to debut its all-electric "kei" car — a class of pint-sized, affordable vehicles smaller than a two-door Mini Cooper — at the Japan Mobility Show that opens to the public on Friday.

The move will make BYD a rare foreign entrant in the kei jidosha, which translates as "light vehicle", segment that accounts for about a third of Japan's auto sales and for decades has been the almost exclusive turf of domestic players like Honda and Suzuki.

BYD has sold just 6,600 of its standard-sized electric vehicles since entering the Japanese auto market nearly three years ago, Atsuki Tofukuji, who heads the company's passenger car sales business in Japan, told Reuters in an interview.

"In terms of our initial expectations, our sales in Japan are missing a zero," Mr Tofukuji said.

Foreign automakers had just a 6% share of the 3.7 million new passenger cars sold in Japan last year.

But some Japanese government officials and industry insiders say BYD could pose a threat with an electric kei car, as consumers are particularly cost-conscious and there are few ultra-compact EVs. Electric cars are eligible for subsidies and tax breaks in Japan.

By designing a car specifically for the world's fourth-largest auto market, BYD appears to be in Japan for the long haul and determined to win over the country's famously picky consumers.