Hyundai Launches Affordable Electric Car in Japan to Compete in Challenging Market
Hyundai is making a bold move into Japan’s electric vehicle (EV) market with the launch of its most affordable compact electric car in Japan, the Hyundai Inster. This new entry aims to disrupt a market that has largely been dominated by Japanese automakers specializing in hybrid petrol-electric vehicles. The launch of the Inster is Hyundai’s latest attempt to make inroads in Japan, where electric vehicles have faced slow adoption.
Affordable EV with Competitive Pricing
The Hyundai Inster will be priced starting at 2.85 million yen (approximately $18,000), making it the most affordable compact EV available in Japan. This price undercuts the BYD Dolphin, a Chinese-made EV that launched in 2023 at 3.63 million yen. Hyundai’s strategy mirrors that of Chinese auto giant BYD, which has gained a strong presence in the EV market by offering budget-friendly electric options. The Inster was unveiled at the Tokyo Auto Salon motor show, and orders for the car opened on Friday.
Hyundai’s Strategy in the Japanese EV Market
The Inster first debuted in South Korea and was introduced to European markets last year under the name Casper Electric. Hyundai is now hoping that this compact and cost-effective EV will appeal to Japanese consumers who have been slow to embrace fully electric vehicles. Despite the affordable price tag, Hyundai faces fierce competition in Japan, particularly from Nissan Motor’s Sakura, an established player in the “kei car” segment.
Priced at 2.60 million yen, the Sakura has been Japan’s best-selling EV in its category, but it saw a nearly 40% drop in sales in 2024, with fewer than 23,000 units sold. This decline reflects the overall struggles that EVs face in Japan’s passenger car market, which sees around 4 million annual vehicle sales.
Hyundai’s Challenges and Market Performance in Japan
Although Hyundai has set its sights on expanding in Japan, the company’s sales in the country have been modest. Last year, Hyundai sold just 607 vehicles in Japan, a small figure compared to the 2,223 units sold by BYD. Other foreign competitors like Tesla have also faced challenges, though Tesla has not disclosed its sales figures in Japan.
Hyundai re-entered Japan’s passenger car market in 2022, focusing exclusively on electric and fuel cell vehicles after pulling out in 2009 due to poor sales. As the world’s third-largest automotive group, behind only Toyota and Volkswagen, Hyundai aims to leverage its global position to strengthen its presence in Japan, a market traditionally dominated by local automotive giants like Toyota and Honda.
The Inster: Hyundai’s Strategy to Boost EV Adoption
With the launch of the Inster, Hyundai is betting on an aggressive pricing strategy and a compact design to appeal to Japanese consumers. The low-cost strategy could help increase competition in Japan’s EV market, which is currently facing slow adoption compared to other countries. The Inster’s affordable price tag, combined with Hyundai’s commitment to producing electric and fuel cell vehicles, represents a clear move to establish the brand as a serious player in Japan’s future automotive landscape.
By targeting the growing interest in environmentally friendly alternatives to traditional combustion engine vehicles, Hyundai hopes to promote broader adoption of electric vehicles in Japan. The Inster could play a pivotal role in Hyundai’s efforts to carve out a larger share of the market and compete with established Japanese automakers who have been slow to fully embrace EVs.
Looking Ahead: The Future of EVs in Japan
While the challenges facing Hyundai in Japan are considerable, the launch of the Inster is a sign of the growing interest in affordable electric vehicles in the country. The EV market in Japan may take time to develop, but with competitive pricing, innovative designs, and a commitment to sustainability, Hyundai’s new compact electric car could play a key role in driving the country toward a greener future.
As more automakers, including foreign competitors, enter the Japanese market with affordable and practical electric vehicles, Japan’s car-buying consumers may find themselves with more choices than ever before. The Inster’s arrival could lead to increased competition, making electric vehicles more accessible to the masses and paving the way for a future where EVs play a larger role in Japan’s automotive industry.
