Key facts
- Japan's EV purchase subsidies are subject to potential budget cuts by the Finance Ministry.
- The industry ministry aims to maintain subsidies to meet carbon emissions goals.
- EV subsidies will increase to 1.3 million yen from January, while fuel cell vehicle support will decrease.
- The U.S. Trade Representative described Japan's subsidy structure as a non-tariff barrier disadvantaging American EV makers.
Japan's electric vehicle purchase subsidies are facing uncertainty as the Finance Ministry considers budget cuts, potentially conflicting with the industry ministry's push to meet carbon emissions goals. The government plans to revise the eco-friendly vehicle subsidy program starting in January, influenced by recent tariff negotiations with the United States. While subsidies for EVs and plug-in hybrids are set to increase, support for fuel cell vehicles will be significantly reduced. The U.S. Trade Representative had previously criticized Japan's subsidy structure as a non-tariff barrier that disadvantaged American EV makers.