China’s BYD is challenging Toyota and other Japanese carmakers by launching a mini electric kei car in Japan. The move follows CEO Wang Chuanfu’s pledge to become the world’s largest carmaker within five years through rapid charging tech and overseas growth. Japan is a key target.

BYD Auto Japan president Atsuki Tofukuji said the company sees an opening for low‑cost EVs the size of a “Mr Bean” Mini Cooper, as high taxes raise fuel costs and petrol stations shrink in rural areas. Kei cars made up 36.5% of new sales last year.

The Racco, priced at ¥2mn after subsidies, offers a 210‑320km range on a full charge and beats Japan’s top electric kei models such as the Nissan Sakura. BYD’s pricing and range give it an edge over rivals. Additionally, BYD operates eight purpose‑built export ships and new factories in Hungary, Brazil, Thailand, Indonesia, and Uzbekistan to support its global push.

Despite the appeal, BYD sold only 3,742 vehicles in Japan last year, a 68% rise from 2024 but still a fraction of the 4.5 million cars sold. Foreign brands remain a small share of the market, presenting a steep hurdle for the Chinese maker.