BYD takes on Japanese rivals with small ‘kei’ car

By the Editorial Team · Tuesday, July 28, 2026

Chinese electric vehicle maker BYD has launched the Racco, a super-compact electric kei car, marking its entry into Japan’s competitive kei car market. This move allows BYD to compete with dominant domestic brands in a segment that represents about 40% of new vehicle sales in Japan, aligning with the company's global expansion strategy.

Chinese electric vehicle manufacturer BYD has entered Japan’s highly competitive “kei” car market with the launch of its new model, the Racco. The company unveiled the super-compact electric vehicle on Tuesday in Tokyo, positioning it against established domestic rivals that dominate this popular segment.

Kei cars, characterized by their small size—up to 1.4 meters in width and 3.4 meters in length—are especially suited to Japan’s narrow streets and account for approximately 40 percent of new vehicle sales in the country. BYD’s Racco measures 180 centimeters in height and is priced starting at 2.1 million yen (approximately $12,830).

BYD, which has gained significant global traction and surpassed Tesla in 2025 to become the world’s leading electric vehicle seller, is making its first foray into the Japanese kei car segment as an overseas automaker. To boost the model’s profile, the company has enlisted prominent Japanese actress Alice Hirose to feature in its advertising campaign.

At the launch event, Liu Xueliang, president of BYD Japan, emphasized the company’s commitment to introducing innovative technology and enhancing convenience and enjoyment for consumers across Japan. The Racco reflects BYD’s broader strategy to expand its presence in diverse international markets, including Europe and now Japan’s niche yet vital kei car industry.

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