Japan seeks to squelch its popular tiny cars

Jun 10 2014, 11:46 IST
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SummaryToshie Yamada’s “kei”, with its pint-size engine and tiny wheels, looks more like a Fisher-Price toy car than a regular truck.

Toshie Yamada’s “kei”, with its pint-size engine and tiny wheels, looks more like a Fisher-Price toy car than a regular truck. But don’t underestimate her Nissan NT 100 Clipper microtruck. At a recent farmers’ market, where she sells orchids from her flower farm here in central Japan, she loaded up a mountain of crates, buckets and a folding table before hopping in and zipping away.

“In these parts, keis are definitely the No. 1 car,” Yamada said. “Big cars are too much of a hassle.”

As farmers’ trucks, family cars, delivery vans and even tiny cafes-on-wheels, keis are everywhere in Japan. They are more popular than ever, thanks to the country’s high petrol prices, a preferential tax system and an uneven economic recovery that have made the wee cars enticing value propositions.

Keis have terrific fuel economies that rival the Prius, but they sell for half the price. Last year, a record 40% of all new cars sold in Japan were keis.

But industry and government officials are increasingly worried that these micro-vehicles have become a distraction for the nation’s automakers — still bastions of the Japanese economy — and are moving to wean drivers off them. In April the government took what its critics charged was a hard-line route. Kei drivers were hit with a triple whammy of a higher sales tax, higher petrol tax and higher kei car tax, the last of which the government raised by 50%, sharply narrowing their tax difference with regular-size vehicles.

“We need to rebalance our priorities,” Yoshitaka Shindo, the minister for internal affairs, said ahead of the tax increase.

Though made by some of Japan’s biggest automakers, including Nissan, Honda, Suzuki and the Toyota subsidiary Daihatsu, the kei — pronounced like the letter K — is not manufactured for export, largely because of its small size and lack of sufficient safety equipment. The engines are limited by law to just 0.66 litre, similar to an engine of a mid-sized motorcycle. Even Ford’s smallest car, the Fiesta subcompact, has a substantially larger

engine.

That means much of the research and development that go into kei models is wasted, officials warn. Producing kei cars just for domestic drivers also hurts automakers’ efforts to achieve economies of scale, which has become increasingly important in an era of cutthroat global competition.

As with other big automakers, Japanese car manufacturers are using the same basic components to build a wide range of models. Servicing

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