The Reason Why Kei Cars Will Not Succeed in America: A Market Analysis

Market reality and regulations suggest these diminutive vehicles have no massive place in the US. President Donald Trump’s recent push to lift restrictions on kei cars seems like a deeply flawed premise.

The idea of automakers bringing kei cars to America is deeply flawed. The US market has a history of rejecting micro cars.

The Fiat 500e sold only 1,076 examples through October. Although its starting price is close to $30,000 USD, its gasoline predecessor also failed to sell well. This suggests that price and range are not the only issues.

Another example is the Mitsubishi Mirage. It has sold over 13,000 units this year, but it is being discontinued after 2025. Insufficient sales do not justify another generation. Smart pulled out of America entirely in 2019 due to lagging sales. This happened despite its relative success in Europe. Smart cited the declining micro-car market and high homologation costs as key factors.

Unsuitability for American Highways

Kei cars are charming on tight city streets like those in Tokyo. However, America’s sprawling highways are not made for them. The lack of power is a safety concern.

Most kei cars average anywhere from 50 to 80 horsepower. Even the Mirage is on the higher end with a scant 78 hp. Trying to merge onto a busy highway with that little power is downright dangerous. Many massive SUVs currently on the road easily exceed 500 hp. Furthermore, most kei cars cannot comfortably cruise past 60 or 70 miles per hour. Their bare-bones construction also makes them unreasonably noisy.

The Insurmountable Price Problem

Price is what will undoubtedly become the biggest issue. Kei cars cost anywhere from ¥1.2 million to ¥2.0 million in Japan. This equates to between $8,000 and $15,000 USD at current exchange rates.

The US Department of Transportation confirmed that imported kei cars will have to meet current safety standards. Regulations for passenger protection and crashworthiness will force manufacturers to retrofit models. Following the Mirage model, the cheapest reasonable price tag for a kei car in America would probably be in the $20,000 USD range.

Trump’s idea is unlikely to get very far unless companies entirely rework their manufacturing for a niche audience.