Kantaro Komiya
CHIBA, Japan (Reuters) – South Korea’s Hyundai Motor (OTC:) said on Friday it will introduce the cheapest compact electric car in Japan as it tries to penetrate a market dominated by local giants with established gasoline and hybrid vehicle technologies.
The launch of the Hyundai Inster in Japan follows attempts by Tesla (NASDAQ:) and other foreign brands to penetrate the country, which has seen slow demand for electric vehicles. With Inster, Hyundai will adopt a low-price strategy similar to that of leading Chinese electric vehicle maker BYD (SZ:).
The base model’s 2.85 million yen ($18,000) price will be the lowest for a compact electric car in Japan, below BYD’s 3.63 million yen price set in 2023 for its Dolphin.
The Inster, which debuted in Europe last year after being launched in South Korea as the Casper Electric, will be delivered to Japanese customers around May, Hyundai Mobility Japan CEO Toshiyuki Shimegi said at a press conference during the Tokyo Motor Show.
In Japan’s ultra-compact, power-limited kei car category, Nissan (OTC:) Motor’s Sakura sells for 2.60 million yen and is the country’s most popular electric vehicle.
But even Sakura sold fewer than 23,000 vehicles last year, down nearly 40% from 2023, industry calculations show, highlighting the lack of popularity of electric vehicles in Japan’s passenger car market, which sells about 4 million vehicles annually.
Last year, Hyundai sold just 607 vehicles in Japan, while BYD sold 2,223. Tesla did not disclose its sales in Japan.
“Inster is our core product to win the acceptance of Japanese customers,” Shimegi said, adding that it will help Hyundai achieve its goal of increasing sales in Japan tenfold in the next five years.
Hyundai, which with Kia forms the world’s third-largest auto group, re-entered Japan’s passenger car market in 2022, offering only electric and fuel cell vehicles, after withdrawing in 2009 due to low sales in the country dominated by Toyota Motor (NYSE:), Honda (NYSE:) Motor and other major Japanese automobile companies.
($1 = 158,0000 yen)