Domestic firms play catch-up as Japan shifts to electric buses
As the global car market trends toward decarbonation, Japanese automakers are now struggling to regain lost ground in their own homeland's electric bus industry.
Electric vehicle (EV) buses are gradually becoming more common in Japan and seeing a rapid rise in the Asian market despite currently accounting for only a tiny fraction of buses nationwide.
The country's auto giants have responded by shifting in earnest to in-house electric bus production to contend with the vehicles being frequently sourced from overseas companies.
10,000 EV BUSES BY 2030
One day in late May, J-Bus Ltd., a joint venture founded by Isuzu Motors Ltd. and Hino Motors Ltd., invited reporters to its Utsunomiya plant in Tochigi Prefecture for a demonstration ride aboard its Erga EV bus.
As its name implies, J-Bus' aim is to produce vehicles such as the Erga EV on behalf of both automakers; Isuzu rolled out the Erga EV in May 2024.
It has since been adopted by a range of networks spanning from Tokyo's Toei Bus service to the shuttle bus line connecting the 2025 Osaka Kansai Expo's venue with the nearest station. This particular model can reportedly travel up to 360 kilometers on a single charge.
Despite the Erga EV's relatively hefty price tag of 66 million yen ($460,000), including tax, using a specialized government subsidy can reportedly cut down the cost to one comparable to its diesel counterparts.
Transport service providers nationwide are steadily embracing EV buses, though Japan still lags significantly behind China and European countries in the spread of electric-powered passenger vehicles. The country had 580 electric buses as of the end of March 2024 compared to the 149 at the close of March 2022.
Electric motors are an ideal match for public buses that typically run along predetermined routes as it is easier for operators to draw up detailed recharging plans in advance.
Another advantage is more room. Not having to rely on a gas engine translates into EV buses having fewer parts, which allows for immensely flexible layouts that could make seating more accessible for passengers with disabilities.
Data from the Automobile Inspection and Registration Information Association shows a total ownership of 210,000 buses across Japan. Electric models represent less than 1 percent of this.
However, the Nihon Bus Association is looking to add 10,000 EV models nationwide by 2030. The government is expanding subsidies to encourage the widespread use of electric buses.
One major competitor domestic automakers must contend with in this shift is Chinese auto firm BYD Co.
Since pitching its EV bus a decade prior in 2015, the company has supplied no less than 400 electric buses to Japan alone, capturing upward of 50 percent of the market share.
BYD announced in January it is releasing a new midsize model designed specifically for the Japanese market; the J7 electric bus is expected to be available by the end of the year.
Another major company eyeing the Japanese market is South Korea's Hyundai Motor Co., which began selling a midsize EV bus in Japan late last year. Hon Hai Precision Industry Co., a major Taiwanese electronics contract manufacturer known as Foxconn, is likewise planning to put an electric bus on sale in Japan by 2027.
WHY THE LAG?
Japanese automakers are scrambling to turn the tide, and J-Bus is not alone. EV Motors Japan Co., a start-up headquartered in Kita-Kyushu, focuses on producing electric buses as well.
Asked why Japanese companies were so slow in rolling out electric bus models, an Isuzu representative insisted that was simply due to their devoted commitment to details.
'We paid due consideration to the development processes in particular to ensure quality and safety simultaneously,' the Isuzu official said.
Manabu Miura, a senior researcher at Japan Research Institute Ltd., who is knowledgeable about the commercial automobile business, provided a different perspective.
'They (Japanese enterprises) focused too much on creating gas-electric hybrid vehicles and fuel cell cars,' Miura said. 'As a result, they were late to invest in the development of EV buses.'
On top of this, the modest market scale likely contributed to Japanese automakers' slow start. Unlike trucks and other business vehicles, commercial bus sales can rarely serve as a revenue pillar since they are purchased less frequently.
Miura stressed that the current situation is unlikely to change dramatically anytime soon—commercial buses are usually replaced only once every 10 or more years.
Daily logistics are another factor making it far more challenging for bus operators to quickly switch suppliers since running buses, training drivers and timetables are closely linked.
'It will take some time to regain ground' Miura said of domestic automakers.
An Isuzu representative appears confident, however.
'Our model is superior to others in operability and reliability,' the representative said. 'We will be pushing our product from a comprehensive standpoint.'
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