Hyundai Motor Co. has announced plans to introduce the most affordable compact electric vehicle (EV) in Japan, marking a bold effort to penetrate a market long dominated by Japanese automakers with established petrol and hybrid technologies.
The South Korean automaker unveiled its strategy during the Tokyo Auto Salon on Friday.
The new vehicle, named “Inster,” will start at 2.85 million yen ($18,000), making it the least expensive compact EV in Japan. This price undercuts BYD’s Dolphin, which debuted in 2023 with a starting price of 3.63 million yen.
Hyundai Mobility Japan CEO Toshiyuki Shimegi described the Inster as central to Hyundai’s ambition to establish a foothold in the Japanese market.
“Inster is our core product to win Japanese customers’ recognition,” Shimegi stated at a news conference. He added that the company aims to increase its Japanese sales tenfold over the next five years.
The Inster, initially launched in South Korea as the Casper Electric and introduced in Europe last year, will be delivered to Japanese customers starting in May. By adopting a low-cost strategy similar to China’s EV leader BYD, Hyundai hopes to appeal to price-conscious Japanese consumers.
The move comes as Japan lags behind other major markets in EV adoption. In 2024, fewer than 23,000 units of Nissan Motor’s Sakura, the country’s top-selling ultra-compact “kei car” EV, were sold—a nearly 40% decline from the previous year.
The Sakura, priced at 2.60 million yen, remains a standout in a passenger car market with annual sales of approximately 4 million vehicles, where EVs account for only a small fraction.
Hyundai’s return to Japan in 2022, focusing solely on electric and hydrogen fuel cell vehicles, follows its 2009 exit due to poor sales. The company now aims to challenge the dominance of Japanese manufacturers like Toyota, Honda, and Nissan by tapping into the growing interest in environmentally friendly vehicles.
Despite its re-entry, Hyundai’s sales in Japan have remained modest, with just 607 vehicles sold last year, compared to BYD’s 2,223 units. Tesla, another foreign competitor, has not disclosed its Japanese sales figures.
“Through Inster, we hope to offer Japanese consumers an affordable yet high-quality EV option that meets their expectations,” Shimegi said.
Hyundai, which forms the world’s third-largest automotive group alongside Kia, is betting on its low-cost compact EV to compete in a challenging market. Whether this strategy will succeed in swaying Japanese buyers remains to be seen.
Boluwatife Enome
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