- EV sales from Nissan’s rivals jumped sharply late last year.
- Japan now offers EV subsidies of up to $8,300 per buyer.
- BYD will launch its all-electric Racco kei car this year.
Electric vehicle sales in Japan have never quite taken off, but disruptions are underway. For nearly 15 years, Nissan held the top spot in the country’s EV market, thanks largely to the Leaf. Now, that grip is loosening.
A cooling appetite for Nissan’s EVs and rising demand for newer offerings from rivals have pushed the market into a new phase. For the first time, Nissan has been overtaken as Japan’s top-selling EV brand in quarterly sales, with Toyota stepping into the lead during Q4 2025.
Read: Toyota Sold Just 18 EVs In Japan Last Month
According to the latest data from Japan’s automotive industry association, Toyota sold 3,684 EVs domestically in the fourth quarter of 2025, a surge helped by the October launch of the bZ4X. While that figure is still modest by global standards, it represents a thirteenfold increase over the same period in 2024.
Nissan, meanwhile, saw its electric sales plunge 56 percent to 2,857 vehicles. The Leaf and Sakura both experienced weaker demand in the closing months of the year.
The momentum wasn’t limited to Toyota. According to Nikkei Asia, Honda also made gains, boosted by the launch of the N-One e:. With a range of up to 295 kilometers (183 miles) on a single charge, it now holds the title for longest-range electric minicar in the market.
Honda sold 2,732 units in Q4, a lift that was enough to pass Tesla, which also saw its numbers rise. Tesla’s sales increased by 62 percent year over year, reaching 2,600 vehicles in the quarter.
EVs Still a Niche in Japan
While EV sales have accelerated in much of the world over the past few years, they still make up only a small fraction of the Japanese market. At present, electric vehicles account for just 1.9 percent of all new car sales in the country. This is the lowest share among advanced economies.
Several new models slated for launch in 2026 could help lift that figure, and the government is moving to speed up the transition too. This year, qualifying buyers can receive up to 1.3 million yen ($8,300) in subsidies, aimed at nudging more drivers toward electric.
BYD may soon become a more significant contender. The Chinese automaker posted a 72 percent increase in Q4 sales, reaching 832 units. It plans to launch its all-new Racco electric kei car in the Japanese market this year, positioning it to make a more aggressive push into a historically difficult segment.
