• BYD is reportedly doing what no other non-Japanese automaker has ever done: it’s working on a kei car.
• The new model will be electric and arrive in Japan in 2026.
• The BYD kei model targets a lower starting price than Japan’s most popular EV, the Nissan Sakura.

Japan’s electric vehicle market fell 33% in 2024 from an already low baseline. But China’s BYD still saw sales growth in the country. Nissan still dominates the Japanese electric car market, and Tesla leads among imported EVs, but BYD is now reportedly working on a model it hopes will slingshot it to the top of the country’s EV sales charts.

Nikkei reports that BYD is working on an electric kei car to rival Japan’s best-selling EV, the Nissan Sakura. The Sakura is a Kei car with a starting price of around $18,250 USD. The Sakura has a tiny 20 kilowatt-hour battery that’s good for a claimed WLTC range of 112 miles (180 km). It gets a heat pump for efficient cabin climate control and 100 kW fast-charging capability.

In order for BYD to hit it big with its kei car in Japan, it needs to beat the Sakura’s specs and offer the car at a lower price. One of the reasons why Japanese car buyers are avoiding EVs (which accounted for just 2% of all new cars bought in 2024) is their higher price. If BYD can undercut the country’s bestseller, it shouldn’t have a problem dethroning it.

According to Nikkei, BYD is currently targeting a starting price of around $17,700, which would fulfill the all-important affordability criteria that would give it the best chance of success.

For a car to meet Japan’s kei car regulations (which bring low taxes on top of the parking/usability advantages of having such a small car), it must not be longer than 11 feet 2 inches (3.4 meters), wider than 4 ft 10 in (1.48 m) or taller than 6 ft 6 in (2 m). Kei cars are also limited to 64 horsepower.

Because kei cars so specific to Japanese regulations and not sold anywhere else, pretty much no company outside of Japan has ever made one. The sole exception (with an asterisk) is Smart, which made its ForTwo narrower and limited its cubic capacity to 660 cc to meet kei regulations in the Japanese market. The closest thing to a foreign kei car today is probably the Hyundai Inster, but it’s still around 10% too big since it’s not designed to meet the specific regulations.

BYD may therefore be the first non-Japanese automaker working on an actual bespoke kei car. It currently sells four models in Japan: the Dolphin, the Atto 3, the Seal and the Sealion 7. The first of these is a small city car, but it’s too wide for the kei car classification, so it’s not as popular as it could be. Its new electric kei car is reportedly coming sometime in 2026.