BYD (BYDDF) has launched its first purpose-built electric mini car for Japan, entering the country's highly competitive kei vehicle market in a bid to accelerate sales.
The new Racco is priced at less than 2 million after subsidies and offers a driving range of at least 210 kilometres. BYD aims to secure 10,000 orders by the end of 2026, a significant target in a market where foreign automakers have historically struggled to gain market share.
Kei cars, which benefit from tax and insurance incentives because of their compact size, accounted for roughly one-third of Japan's new vehicle sales last year. The segment has long been dominated by domestic manufacturers including Nissan (NSANY), Suzuki (SZKMY), Honda NYSE:HMC and Daihatsu, making it one of the toughest markets for overseas brands to penetrate.
BYD sold about 7,400 vehicles in Japan through the end of 2025 after entering the country's passenger vehicle market in 2023.