Tesla plans to double its directly operated service centers in Japan to more than 30 this year, as surging sales drive growing demand for after-sales support.
According to a Nikkei report published on Monday, the company currently runs 14 service centers nationwide, mainly in major cities.
These are equipped to handle inspections, maintenance and repairs, including body work.
With the initial auto inspection for new vehicles required three years after registration, Tesla is anticipating a sharp increase in service demand as its customer base grows.
Many of the new locations will be situated near Tesla dealerships, with the company targeting turnkey properties that previously served as maintenance shops to expand quickly and at low cost.
In areas without a directly operated center, Tesla is partnering with local auto care facilities, giving customers access to more than 50 service locations across the country.
Reacting to the report, CEO Elon Musk wrote on X that “Tesla is making a big investment in Japan with service & Superchargers.”
According to Musk, “many of the parts in Teslas are made in Japan.”
He exemplified with Panasonic, which “has been our biggest strategic supplier over the past 2 decades.”
Panasonic
Panasonic manufactures and supplies the lithium‑ion cells that Tesla uses inside its battery packs for both its vehicles and its energy storage products, which include the Powerwall, Powerpack, and Megapack.
Panasonic has supplied 18650 and 2170 cylindrical lithium‑ion cells for Tesla‘s earlier and current EV models.
Additionally, the company has been involved in developing the next generation 4680 cell form factor — a larger, more energy‑dense cylindrical cell design that Tesla plans to use in future vehicles.
In 2022, Panasonic’s Chief Financial Officer Hirokazu Umeda said the company was planning “to put top priority on Tesla” once they were able to deliver the packs.
Asian Suppliers
Its best-selling Model 3 and Model Y vehicles use batteries supplied by Panasonic, LG Energy Solution, and China’s largest battery manufacturer, CATL.
The US Government confirmed earlier this month that Tesla is the customer behind one of the largest battery deals of 2025 — LG Energy Solution’s $4.3 billion battery supply contract.
Both companies have agreed to build a lithium iron phosphate prismatic battery cell manufacturing facility in Lansing, Michigan, with production scheduled to begin in 2027.
Last July, Tesla also signed a $16.5 billion deal with Samsung Electronics to produce AI semiconductors.
The agreement will run until 2033 and includes a new plant in Taylor, Texas.
Last year, South Korea emerged as Tesla‘s third-largest market globally.
The company sold 59,893 vehicles in the country last year, with the Model Y alone accounting for 50,397 units — a 169% increase year-over-year.
The sales jump was reflected in the launch of the Cybertruck model there and the introduction of the Full Self-Driving software — with South Korea becoming the seventh market to have the software.
Sales in Japan
The service expansion follows a sharp rise in sales.
Tesla delivered roughly 10,600 vehicles in Japan last year, up 90% year-over-year and surpassing the previous high of around 5,900 units in 2022.
The company credits a shift from online marketing to in-person dealership sales, expanding its dealership count from roughly 10 to around 30.
Limited-time discounts also contributed to the growth, Nikkei reports.
Up until March 31, the company is offering a 0% APR rate on both the Model 3 and Model Y, which can be combined with a newly increased subsidy for EV purchases.
The best-selling Model Y is priced from 5,587,000 yen ($35,000), while the Model 3 sedan begins at 5,313,000 yen ($33,300).
EV Subsidy
The Japanese Ministry of Economy, Trade and Industry (METI) recently changed the upper limits of the subsidies to purchase clean-energy vehicles.
The maximum subsidy for fully electric vehicles increased from 400,000 yen ($2,500) to 1.3 million yen ($8,100).
Chinese automaker BYD has been left behind in Japan’s latest revision of EV purchase subsidies; however, with none of its four models seeing an increase.
BYD’s vehicles remained capped at 350,000–450,000 yen, leaving the company at a competitive disadvantage in Japan, it said.
“We’re at an overwhelming disadvantage,” said Atsuki Tofukuji, head of BYD Japan. “The gap has grown to up to nearly 1 million yen. We can’t compete with 350,000 yen.”
The METI said adjustments were made following US-Japan tariff talks, aiming to ensure fair competition.
“As a result, the amounts rose for some models,” said a METI representative.
Both the United States and the European Union imposed tariffs on Chinese EVs in 2024, claiming that Chinese automakers had an unfair advantage thanks to government subsidies.
According to BYD‘s fourth quarter earnings report published last Friday, the company received 12.47 billion yuan ($1.8 billion) in government subsidies related to its daily operations in 2025.
For context, BYD‘s government subsidies in 2025 exceeded its total investment income of 2.86 billion yuan by more than four times.
BYD in Japan
BYD entered the Japanese market back in early 2023, introducing the Atto 3 SUV and the Dolphin compact car (named Seagull in China).
According to official registration data, the Chinese giant sold 3,742 vehicles in Japan last year.
In the first two months of 2026, total sales reached 595 units — more than doubling year over year.
BYD plans to launch the Racco — a kei car developed specifically for the Japanese market — in the summer of 2026.
The Seal 6 wagon and compact SUV Atto 2 are also expected in Japan this year, which would bring BYD’s lineup to around eight models.
The company has said it aims to offer seven to eight pure electric and hybrid models in Japan by 2027.
Alike Tesla, BYD aims to expand its sales network in Japan by opening smaller dealerships — showcasing only one or two models — as reported earlier this year by Nikkei.
