Small Cars - Japan

Japan

Highlights

Revenue in the Small Cars market is projected to reach US$12bn in 2024.
Revenue is expected to show an annual growth rate (CAGR 2024-2029) of -0.47%, resulting in a projected market volume of US$12bn by 2029.
Small Cars market unit sales are expected to reach 711.6k vehicles in 2029.
The volume weighted average price of Small Cars market in 2024 is expected to amount to US$17k.
From an international perspective it is shown that the most revenue will be generated China (US$13bn in 2024).

Key regions:

Market definitionIn-Scope/Out-of-scopeMarket structureReportsMethodology

The Small Cars market in Japan has been experiencing steady growth over the past few years, driven by a combination of customer preferences, market trends, local special circumstances, and underlying macroeconomic factors.

Customer preferences: In Japan, there is a strong preference for small cars due to their compact size and fuel efficiency. With limited parking space in urban areas and high fuel prices, Japanese consumers are increasingly opting for smaller vehicles that are easier to maneuver and offer better fuel economy. Additionally, small cars are often more affordable than larger vehicles, making them an attractive option for cost-conscious consumers.

Trends in the market: One of the key trends in the Small Cars market in Japan is the growing demand for electric and hybrid vehicles. As the government continues to promote environmental sustainability and reduce carbon emissions, there has been a significant shift towards cleaner and more fuel-efficient transportation options. This has led to an increase in the production and availability of electric and hybrid small cars in the market. Another trend in the market is the integration of advanced technology and features in small cars. Japanese automakers are known for their innovation and are constantly introducing new technologies and features to enhance the driving experience. This includes features such as advanced safety systems, infotainment systems, and connectivity options, which are becoming increasingly important for consumers.

Local special circumstances: Japan has a unique set of circumstances that contribute to the growth of the Small Cars market. The country has a well-developed public transportation system, which means that many people rely on trains and buses for their daily commute. As a result, small cars are often used for short trips or as a second vehicle for families. Additionally, the aging population in Japan has also influenced the demand for small cars, as older individuals may prefer smaller and easier-to-handle vehicles.

Underlying macroeconomic factors: The Small Cars market in Japan is also influenced by underlying macroeconomic factors. Economic stability, low interest rates, and favorable financing options have made it easier for consumers to purchase small cars. Additionally, government incentives and subsidies for purchasing eco-friendly vehicles have further boosted the demand for small cars, especially electric and hybrid models. In conclusion, the Small Cars market in Japan is experiencing growth due to customer preferences for compact and fuel-efficient vehicles, the trend towards electric and hybrid models, the integration of advanced technology, local special circumstances such as a well-developed public transportation system and an aging population, and underlying macroeconomic factors such as economic stability and government incentives.

Data coverage:

The data encompasses B2C enterprises. Figures are based on the sales of new passenger cars. Data on the specifications of the sold vehicles is based on the base models of the respective makes.

Modeling approach:

Market sizes are determined through a bottom-up approach, building on specific predefined factors for each market segment. As a basis for evaluating markets, we use company reports and websites, vehicle registries, car dealers, and environment agencies among other sources. In addition, we use relevant key market indicators and data from country-specific associations, such as GDP and car stock per capita. This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, we use the ARIMA model for the Passenger Cars market. The main drivers are GDP per capita and consumer spending per capita.

Additional notes:

The data is modeled using current exchange rates. The impact of the COVID-19 pandemic and the Russia-Ukraine war are considered at a country-specific level. The market is updated twice a year. In some cases, the data is updated on an ad hoc basis (e.g., when new, relevant data has been released or significant changes within the market have an impact on the projected development).