Japan Wants to Axe the Kei Cars
Pronounced like the letter “K”, Japan’s small and efficient kei cars have been the lifeblood of the working-class for years – serving as economical city-cars, delivery vans, work trucks, and even food vendors. But the Japanese government sees the pint-sized vehicles as a stumbling block for the country in mid-recovery, and is putting the pressure on automakers to start phasing them out. Kei cars rose to greatness following World War II in order to spur growth of the Japanese car industry and provide a cheap mode of transport that offered more utility than say, a motorcycle. Successive revisions to the kei car specifications furthered their popularity, and last year, according to The New York Times, more than 40 percent of new cars sold in Japan were keis.
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However, in April of this year, the Japanese government significantly hiked the sales tax, gasoline tax, and ownership tax of kei cars in order to persuade buyers into full-size models rather than downsizing into small keis. Government officials warn that the Japanese car industry, which remains one of the country’s leading industries, will lose profitability by continuing to focus so heavily on kei production.
Keis predominantly stay within the Japanese domestic market, meaning that automakers have to split their resources between developing kei cars for the home market or larger cars for both domestic and abroad use.
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Given the vast popularity of keis in Japan, the move has been quite unpopular among working-class car owners who rely on the cheaper kei cars just to make ends meet. So much so, a staggering 20 percent of kei owners surveyed said they would consider giving up the cars altogether if the taxes continued to climb.
Forcing keis to the wayside might make room for larger profits abroad, but alienating a massive domestic market – 2.23 million keis sold last year – isn’t without its own problems, especially in the midst of economic insecurity.