Responding to rising energy prices globally, Japan has taken historic steps to support the electric vehicle market.
The massive incentives implemented under this scheme have made brand-new cars even cheaper than their used market value on the second-hand market.
DOUBLE INCENTIVES DROVE PRICES TO THEIR HIT ROCK BOTTOM.
In addition to the subsidies increased by the central government in January, the Tokyo Metropolitan Government added a massive local support of 1,3 million yen at the beginning of this month.
These two incentives, combined under certain conditions, reduced the price of the Nissan Sakura model from its normal list price of 2,44 million yen ($15,000) to 560,000 yen ($3,450).
Similarly, the price of the Honda Super-One model dropped to 790,000 yen ($4,870), while the Toyota bZ4X model began selling for less than half its original price.
SALES INCREASED EXPONENTIALLY.
Following this development, Tesla sales tripled, while Toyota's electric vehicle sales increased by a staggering 38 times.
The fact that used electric vehicles cannot benefit from these government subsidies has begun to seriously disrupt the market.
The fact that a new car is cheaper than a used one has completely eliminated domestic demand for used cars.
The rapid export of used vehicles that cannot find buyers domestically creates the risk of critical rare earth metals and batteries being smuggled out of the country.
Automotive manufacturers, however, worry that this massive decline in value will scare consumers and that the market will collapse if the incentives are suddenly cut off.
