Tesla price cut fuels EV sales in Japan

New registrations of imported electric vehicles in Japan has more than doubled in 2021. One of the reasons behind this is Tesla cars becoming cheaper, reports Bloomberg. The report claims that Tesla cut the price of its long-range version of the Model 3 compact sedan by 24 per cent last year. This made the Tesla Model 3 long-range variant cheaper by 5 million yen in Japan, boosting demand for the car.

Japan has been relatively slow in terms of embracing electric vehicles. The lack of charging stations, parking space and insufficient subsidies have remained the bottlenecks for the growth of EVs in Japan. EVs remain pricier than petrol vehicles in the country. This resulted in foreign EV manufacturers shying away from introducing their electric vehicles in the country. However, with EVs becoming more affordable the demand for these vehicles have been rising in the country.

Registrations for the imported electric vehicles recorded 8,610 units in 2021, up from 3,238 units in 2020, said Japan Automobile Imported Association on Tuesday. It also said that electric vehicles accounted for 3.3 per cent of foreign car registrations in the country, compared with 1.3 per cent in the previous year.

Hybrid cars on the other hand are more popular in the country, where the EV penetration rate is around one per cent of the vehicle market. Registrations of imported petrol hybrid cars increased to 37,530 units last year from 13,465 in 2020, claims the report.

However, in the last couple of years, electric vehicles are finding an increasing number of takers there. The country aims to achieve carbon neutrality in three decades. Aiming at that, the Japanese government doubled the subsidies for electric vehicles in November 2021. This is helping in ramping up the demand for EVs.