2027 BYD Racco joins hotly-contested Japanese kei car segment as new budget EV rival to Honda N-One, Suzuki Spacia and Nissan Sakura

BYD is taking the fight right into the heart of its fiercest rivals' territory as it launches a cheap new EV in Japan.

The BYD Racco launches in Japan as a city car with its sights set on the country's ultra-affordable kei car segment. 

It is available in two variants, both starting from less than 2.5 million yen, which is roughly the equivalent of $20,000. 

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Kei cars miss out on hefty vehicle taxes in Japan if they meet stringent design rules, making them a very affordable and practical transport option.

BYD is introducing the Racco to tackle the otherwise Japanese-dominated city car segment, with a view to gaining a foothold in another global market. 

The front-wheel drive only Racco’s single electric motor is limited to produce 47kW and 160Nm in line with Japanese rules. 

It has electric sliding doors on both sides to improve accessibility in narrow streets, and can also power external devices through vehicle-to-load capacity. 

The Racco’s platform enables DC charging at 100kW, meaning a 10-80 per cent charge should take around 20 minutes. 

Features inside the cabin include a 10.1-inch central touchscreen, heated front seats and a heated steering wheel. 

There is expected to be an even cheaper variant of the Racco coming later, with a 20kWh battery and a 200km driving range. 

Kei cars like the Racco face challenges to comply with Australian Design Rules, including inadequate side impact crash protection. 

Honda recently put its Super-One electric city car on sale Down Under, which is based on its N-One Kei car.

It underwent significant changes, including a bigger frame, to ensure it complied.