"Because of BYD?" Japan's Ministry of Economy, Trade and Industry Cuts EV and PHEV Subsidy Caps by Roughly Half

*This content was translated by AI.View Original

Japan's Ministry of Economy, Trade and Industry officially announced that it will lower the support amounts and caps for the Clean Energy Vehicle (CEV) Adoption Promotion Subsidy under the revised budget on October 21. This subsidy revision is a measure to address the situation in which the number of applications has surged, increasing the likelihood that the budget will be exhausted earlier than the original final application deadline of February 12, 2027.

According to Japan's Ministry of Economy, Trade and Industry, the move was made with the aim of sustaining the subsidy program stably for as long as possible within the limited scope of the current budget. The revised subsidy payment regulations will take effect from January 1 next year.

The maximum subsidy amount by vehicle type (based on achieving a score of 130 points or higher) is being reduced. For standard electric vehicles (EVs), it is lowered from the previous 1.25 million yen (approximately 10.55 million won) to 750,000 yen (approximately 6.33 million won). For kei-class electric vehicles, it is adjusted from the previous 550,000 yen (approximately 4.64 million won) to 440,000 yen (approximately 3.71 million won). For plug-in hybrid electric vehicles (PHEVs), it is reduced from the previous 800,000 yen (approximately 6.75 million won) to 480,000 yen (approximately 4.05 million won). For hydrogen fuel cell vehicles (FCVs), it is lowered from the previous 1.45 million yen (approximately 12.24 million won) to 870,000 yen (approximately 7.34 million won).

The bonus points for evaluating automobile manufacturers' eco-friendly efforts related to the adoption of steel materials for emissions reduction under the Ministry of Environment and the promotion of GX (Green Transformation) have also been scaled back from a maximum of 50,000 yen (approximately 420,000 won) to a maximum of 30,000 yen (approximately 250,000 won). The bonus for kei-class electric vehicles has been adjusted from a previous maximum of 30,000 yen to a maximum of 18,000 yen (approximately 150,000 won).

The industry is offering various opinions on the Ministry of Economy, Trade and Industry's subsidy cuts. Among these, it is necessary to note that sales of BYD's Japan-exclusive kei-class electric vehicle, the Racco, have surged. According to BYD Auto Japan, the "Racco," launched on July 28, secured more than 1,000 contracts within two weeks. Its target for this year alone is 10,000 units. Analysts say this reflects a sense of urgency that was quickly incorporated into the decision.

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*This content was translated by AI.View Original