Japan’s automotive landscape is transforming significantly as electric vehicles (EVs) gain traction. Technological advancements, environmental concerns, and supportive government policies influence this shift. Analyzing the current state of EV adoption, comparing it to five years ago, and projecting future trends provides insight into Japan’s evolving transportation sector.
Japan’s EV market is expected to expand to almost USD 111.10 billion by 2030, with a compound annual growth rate (CAGR) of 15.58% (Maximize Market Research, n.d.). In 2023, there were approximately 31,600 publicly accessible electric vehicle supply equipment chargers (EVSE) in Japan (Arba, 2024).
In 2018, Japan’s electric vehicle sector was in its early stages, with minimal infrastructure and consumer uptake. The previous five years have seen significant development owing to growing environmental consciousness, government incentives, and breakthroughs in EV technology. Expanding charging infrastructure and releasing cheaper EV models have helped drive this upward trend.
Future Projections and Manufacturing Leaders
The Japan Electric Vehicle Market is anticipated to amount to 12.15 billion USD by 2032, at a CAGR of 7.55% from 2022 to 2032 (Spherical Insights, n.d.). Projections indicate that battery electric vehicles (BEVs) will lead with a 37.8% revenue share by 2032. Passenger cars are expected to prime EV sales, driven by original equipment manufacturer (OEM) efforts and government incentives.
Nissan Motor has pioneered Japan’s EV market, with the Nissan Leaf being one of the most popular models. However, the market is becoming gradually competitive with the entry of foreign manufacturers. For instance, Hyundai Motor is introducing the Hyundai Inster, a compact electric car priced at $18,000, aiming to penetrate the Japanese market dominated by local manufacturers (Komiya, 2025). Additionally, Honda has unveiled the N-VAN e, a compact electric truck priced at $15,500, set to launch in Japan in October 2024 (Carter, 2024). Additionally, other influential players in the market include DENSO Corporation, Kawasaki, Aspark Co., Ltd., Nippon Sharyo, Suzuki, SkyDrive, Luup, Subaru, Daihatsu Motor Co., Ltd., FOMM, Hino Motors, Niigata Transys, Lexus, Kinki Sharyo, Yamaha, Toyota Motor Corporation, and Mitsubishi Fuso Truck and Bus Corporation (Spherical Insights, n.d).
Charging Infrastructure and the Impact on Emissions
The growth of charging infrastructure is essential for EV adoption. In 2023, Japan had around 31,600 publicly accessible EV chargers (Arba, 2024). The government and corporate sector are investing in more charging stations to help accommodate the rising EV fleet. According to the figure below, which is derived from historical and historical CAGR, Japan’s electric vehicle charging equipment market is expected to reach USD 1.54 billion by 2030 and 3.50 billion by 2045, with a CAGR of 14.17%.
Figure 1: Japan’s current electric vehicle charging equipment market and projected growth to 2030.
The shift towards EVs is expected to impact Japan’s emission trends positively. The Japanese government has targeted achieving 100% electric vehicles in new light-duty vehicle sales by 2035 and a 46% reduction in CO2 emissions by 2030 (InfluenceMap, n.d.). The adoption of EVs, coupled with the expansion of alternative energy sources, is anticipated to reduce greenhouse gas emissions significantly.
Several government initiatives and regulations are driving this growth. The Japanese government has actively supported EV adoption with various incentives and legislation. Subsidies for EV sales, tax breaks, and investments in charging infrastructure are some strategies used to encourage people to transition to electric vehicles. Furthermore, the government has set lofty goals for EV adoption, seeking to significantly expand the number of electric vehicles on the road in the coming years.
Challenges and Considerations
Despite the positive outlook, challenges remain in achieving widespread EV adoption. Some barriers that must be addressed are the high cost of EVs, limited driving range, and insufficient charging infrastructure. Furthermore, consumer awareness and acceptance are crucial in the transition to electric mobility. Continuous efforts from the government, manufacturers, and other stakeholders are crucial to overcome these encounters and enable the growth of the EV market in Japan.
This Post was submitted by Climate Scorecard Japan Country Manager Dr. Delmaria Richards.
Contact Information
Contact the Ministry of Land, Infrastructure, Transport and Tourism (MLIT) for more information on Japan’s transportation policies and EV initiatives.
Contact Person: Mr. Niwa Katsuhiko
Position: Director-General, Road Bureau at the Ministry of Land, Infrastructure, Transport and Tourism
Email: road_bureau_info@mlit.go.jp
Address: 2-1-3 Kasumigaseki, Chiyoda-ku, Tokyo 100-8918
Phone: +81-3-5253-8111
References
- Arba, A. (2024, May 27). Number of publicly accessible electric vehicle supply equipment (EVSE) chargers in Japan from 2010 to 2023 by type of charger. Statista. https://www.statista.com/statistics/1129911/japan-electric-vehicle-chargers-number/
- Carter, T. (2024, June 14). Business Insider. Japan can’t get enough of tiny vehicles. Here’s Honda’s latest: a $15,500 miniature EV truck. https://www.businessinsider.com/honda-15500-tiny-electric-truck-japan-photos-look-inside-2024-6?utm_source=chatgpt.com
- Komiya, K. (2025, January 10). Hyundai launches $18,000 EV in Japan to penetrate EV-wary market. Reuters. https://www.reuters.com/technology/hyundai-launches-18000-ev-japan-penetrate-ev-wary-market-2025-01-10/
- InfluenceMap. (n.d.). Need for Vehicle Electrification. https://japan.influencemap.org/policy/2035-vehicle-electrification-target-5357?utm_source=chatgpt.com
- Japan Electric Vehicle Market: Industry Analysis and Forecast (2024-2030) Trends, Statistics, Dynamics, Segmentation by Vehicle Type and Fuel Type. (n.d.). Maximize Market Research. https://www.maximizemarketresearch.com/market-report/japan-electric-vehicle-market/64280/
- Japan Electric Vehicle Market Insights Forecasts to 2032. (n.d.). Spherical Insights. https://www.sphericalinsights.com/reports/japan-electric-vehicle-market
- Komiya, K. (2025, January 10). Hyundai launches $18,000 EV in Japan to penetrate EV-wary market. Reuters. https://www.reuters.com/technology/hyundai-launches-18000-ev-japan-penetrate-ev-wary-market-2025-01-10/
- Mordor Intelligence. (n.d.). Japan EV Charging Stations Market Size & Share Analysis – Growth Trends & Forecasts (2025 – 2030).
https://www.mordorintelligence.com/industry-reports/japan-electric-vehicle-charging-equipment-market?utm_source=chatgpt.com
Image Source: Comyu