Japan’s Response to Tesla’s Decline

The world is quickly shifting toward sustainable energy — and it’s not just a fad. There are both global and personal reasons behind this movement. Climate change remains a serious and disturbing concern for humankind.

According to the United Nations, “The last decade (2011-2020) was the warmest on record, and each of the last four decades has been warmer than any previous decade since 1850.”

Year-to-year rising temperatures raise one critical question: How do we produce and manufacture?

As a major direct and indirect energy consumer, the automotive industry offers unprecedented opportunities for the everyday use of renewable energy. Japan stands out as a leader in this space, offering a wide range of battery electric vehicles (BEVs).

With Tesla stock down 45%, Japanese automakers could regain their competitive edge with new models targeting new markets.

Toyota Motor Corporation, the largest car manufacturer in the world, sold 10.16 million vehicles in 2024 (compared to Volkswagen Group’s 9.03 million). Toyota pioneered hybrid technology with the launch of the Toyota Prius in 1997, the first mass-produced hybrid vehicle.

This year, at the Shanghai Auto Show, its bZ7 model debuted as the first joint venture to feature Huawei’s Harmonyos cockpit system. The all-electric sedan joins Toyota’s bZ line, following the bZ3, bZ3X, bZ4X, and bZ5. Co-developed locally with Guangzhou Automobile Group, the bZ7 is expected to enter the market within a year.

In March 2024, Nissan, a top-10 automaker globally and top-4 in Japan (following Toyota, Suzuki, and Honda) with 3.37 million cars sold, introduced the N7 — a mid-size sedan designed specifically for the Chinese market and expected to launch this year.

As a part of the company’s mid-term strategy, Nisan aims to release 30 new models worldwide and seven in the US by 2027, including both hybrids and BEVs.

The Nissan Sakura, the best-selling electric car in Japan, recently got an update. With features like driver assistance, auto parking, fast charging, and bidirectional power — and a price starting at $17,000 — it’s an attractive option. However, it remains exclusive to the Japanese market. While there are no plans to sell it abroad, the system reportedly supports English, and buying one second-hand may be possible for international buyers.

Honda, the world’s ninth-largest manufacturer, with 3.81 million cars sold, developed the Prologue mid-size crossover SUV specifically for the North American market. It was introduced to the public in 2022. Production began in 2024 through a partnership with General Motors in Ramos Arizpe, Mexico. It features a Google-built-in system and advanced battery management. Future models are expected to be able to charge with Tesla’s charging connector.

Toyota’s premium brand, Lexus, also offers an all-electric crossover SUV in North America, Europe, and Asia. The Lexus RZ model debuted in 2021, went on sale in 2022, and reached North America by 2023. In 2024, RZ sales in the U.S. jumped 80%, with 9,697 units sold, up from 5,386 in 2023.

The auto market is evolving fast, with new models presented yearly. China is another major player, home to major brands like BYD, SAIC, and Chery, offering innovations and affordability. However, concerns about quality still linger.

Japanese cars have long been known for their durability and long-term reliability. However, with the new Toyota bZ7, we may enter a new era of highly dependable and tech-advanced vehicles created through collaborations of both markets.