Tesla Sets Up Shop In Japan, Sells First Electric Cars

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Tesla Motors CEO Elon Musk delivers first Tesla Model S electric cars in Tokyo, Sept 2014

Tesla Motors CEO Elon Musk delivers first Tesla Model S electric cars in Tokyo, Sept 2014

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While Tesla Motors now sells electric cars in North America, parts of Europe, and--perhaps most importantly--China, it continues to expand its sales footprint.

The most recent addition is Japan, a notoriously closed market where only one of the three largest makers has any interest at all in electric cars.

(That'd be Nissan.)

Tesla Motors CEO Elon Musk at Tesla Store opening in Westfield Mall, London, Oct 2013

Tesla Motors CEO Elon Musk at Tesla Store opening in Westfield Mall, London, Oct 2013

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In mid-September, Tesla CEO Elon Musk handed over the keys to several new Model S cars to the company's first customers in a ceremony in Tokyo.

And needless to say, Musk tweeted about it, and The Wall Street Journal also wrote about the event.

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In his speech, Musk noted that the "heart" of the Model S electric luxury sedan--its battery pack--is Japanese, containing lithium-ion cells made by its partner Panasonic.

(At least, that is, until its Nevada gigafactory starts producing battery cells in three years or so.)

Tesla Model S lithium-ion battery pack in rolling chassis [photo: Martin Gillet via Flickr]

Tesla Model S lithium-ion battery pack in rolling chassis [photo: Martin Gillet via Flickr]

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In fact, one of the first nine cars delivered went to Yoshi Yamada, a Panasonic executive vice president, who took delivery of the car at the handover ceremony--for company use, he said.

But while its heart may well be Japanese and the Tesla brand name now carries global cachet, the company may still find Japan a tough market to penetrate.

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Among other "soft" barriers to importing cars, each individual vehicle imported for sale in Japan must be inspected to ensure it complies with Japanese regulations.

Not only is Japan effectively a closed market to foreign automakers, but two of its largest automakers are openly hostile to battery-electric and plug-in vehicles.

2014 Tesla Model S

2014 Tesla Model S

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While Mitsubishi built the first modern electric car to be sold in volume--its now-aging i-MiEV--and Nissan has sold more electric cars than any other maker in the world, Toyota and Honda have frequently said electric cars are only suitable for short-distance urban uses.

Instead, both makers have placed their bets on hydrogen fuel-cell vehicles.

The Japanese government is now funding the deployment of hydrogen fueling infrastructure, starting with the country's largest cities and along its highways.

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