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Why Is It So Expensive To Own A Car In Japan?

Why Is It So Expensive To Own A Car In Japan?

If you plan on moving to Japan anytime soon, don’t bother purchasing or owning a car while you’re in residence. The expenses of owning a car in Japan from all the various rules and regulations make it a hassle for you and your wallet even to bother owning a car there. But why is it so expensive?

It’s expensive to own a car in Japan because the country requires multiple costly annual car inspections, parking spot fees, and acquisition taxes when first purchasing a car. All of this is without mentioning insurance, annual taxes, and gasoline.

Japan’s auto-laws definitely keep their cars safer but is owning a car really worth all the extra nonsense that goes along with it? This becomes all the more frustrating when moving from America when you don’t have to get your car inspected unless you want to, and you can drive a car until it gives out without having to have an extra inspection.

Costs of Owning a Car in Japan

The table below will provide the overall costs of owning a car in Japan:

White PlateYellow Plate
Cost of a Car (used)240,000 – 300,000 yen160,000 – 220,000 yen
Cost of a Car (new)1,000,000 yen and upunder 1,000,000 yen
Automobile Acquisition Tax5% of the price of the carN/A
Automobile Tonnage Tax (based on weight)50,000 – 75,000 yenunder 50,000 yen
Name Change10,000 – 25,000 yen3,000 yen
Shaken Inspection120,000 yen and up70,000 – 100,000 yen
Older-Than-10-Year-Inspection(from 10,000 yen up to half the price of your shaken)N/A
Compulsory Third Party Insurance(included with shaken)N/A
Mandatory Liability Insurance (per year)30,000 yen20,000 yen
Optional Insurance (per year)40,000 – 70,000 yenN/A
Automobile Tax (per year, depending on size)30,000 – 50,000 yen5,000 – 20,000 yen
Gasoline (about 4000 yen per tank)about 110 yen per literN/A
Permanent Parking Space (per month)0 yen (in the countryside) – 20,000 yen (in the big city)N/A
Short-term Parking100 – 500 yen per hour; 500 – 5000 yen per dayN/A
Other Maintenance0 – 50,000 yen per yearN/A
Table Courtesy of Supermelf

White vs. Yellow Plate Cars in Japan

The table above shows a distinction between types of cars referred to as White or Yellow plated. The plate that it’s referring to is the license plate. The two main types of plates used are yellow with black lettering or white with green or black lettering.

  • Yellow-plated cars are small and compact cars. The most common of the yellow-plated cars are the Kei-cars. Kei cars are small, highly regulated cars that are designed for the tight roads of Japan. They come in all shapes and can even come with four-wheel drive capabilities.
  • White plate cars are cars with more than 660 cc engine displacement. These are actually the kinds of cars that the rest of the world drives around in. Although we are accustomed to paying normal prices for repairs in these types of vehicles, white plate cars are much more expensive to buy and maintain in Japan.

Cost of Obtaining a Japanese Driver’s License

Japan has a driver’s test just like any other country, but its passing rate is very low, and the process is grueling and expensive. Drivers are required to attend a Driver’s Education School that costs around $3,000.

At this school, you essentially learn all the ways that driving instructors try to fail you and how to avoid that. Most Americans will fail their first few tries because of how strict the guidelines are to follow and how much of a transition it is from what we are used to. Supermelf mentions that “the most important thing about the test is not to get frustrated with the ridiculousness of the test.”

So before you can even buy a car and everything that goes along with it, you have to spend $3,000 on a school that teaches you how to overdramatize your driving skills to get your license. If you manage to pass the test, then you can begin the arduous process of buying a car.

Cost of Buying a Car in Japan

In America, the average transaction price for a new car as of 2018 is just over $35,000, according to PR News Wire. Lucky for the Japanese, new White Plate cars start at around $9,201, which is probably the only advantage they have over America’s car prices.

If you are looking for a used car in Japan, then you can find them starting at around $1,472, which isn’t that bad. The average cost of a used car in America is around $20,000, but I’ve seen used cars sell for under $1,000, so I would say that the prices are about even for used cars in comparison.

The kicker for Japan is the taxes. The immediate taxes when buying a car include an acquisition tax of 5%, a tonnage tax that can range from $460 to around $690. This adds another $1,100+ to the several thousand you just paid for your car.

You also have to factor in a Name Change for your car, ranging from $27 to $250.

Costs of Car Inspections in Japan

Every two years in Japan, cars have to go through the Shaken inspection process. The Shaken inspection is a “road-worthy” car inspection that has to be done by a dealer or gasoline stand every two years. 

To have your car “street legal,” you are forced to have your car inspected every two years. The process includes wheel alignment, speedometer inspection, brake inspection, exhaust inspection, undercarriage, suspension inspection, and an inspection to ensure that all cars meet Japanese Exterior Regulations.

This process can run you from around $644 to $1,612 every other year. American car owners gauge how often they want to repair their cars, and while some suffer the consequences, others have honest repairmen that they confide in for car maintenance when things aren’t running as they should be or when you need your oil changed.

If a car cannot pass the Shaken process, it is considered unfit and unpermitted on public roads. Having an illegal car can result in legal fees or further punishment, depending on how many infractions you have.

Costs of Japanese Car Insurance

Much like in America, Japanese drivers must have a proper driver’s license and car insurance. The average cost of car insurance in America, according to Zebra, is around $1,426 per year. This is the average for liability insurance and the other perks you would receive in a Nationwide, Progressive, or State Farm car insurance plan.

Japanese car insurance isn’t too far off from American prices. Mandatory Liability Insurance starts at around $200/year, and additional insurance covering more than just liability can begin at around $600/year.

Both countries do require liability insurance at the absolute minimum. We all know of someone who got caught in a hit and run because the other driver didn’t have insurance, and Japan’s slim roads leave very little room for error. If you’re leaving for Japan, make sure you remember to get your insurance!

Miscellaneous Fees for Cars in Japan

Overall, if you overlook the initial taxes, then owning a car in Japan doesn’t seem so bad. But it’s the miscellaneous fees that really hit your wallet. 

Garages and Parking Spots

Americans are likely used to paying for valet parking, parking passes, parking meters, or parking garages, but nothing is hindering us from parking in our own driveways for free. This isn’t always the case in Japan.

Japan requires proof of parking spot or garage when drivers attempt to purchase a car, which requires a monthly payment. In cities on the outskirts of larger cities containing around 300K people, parking runs around $83 monthly, which adds up to about $996 per year. Cities like Tokyo can run you from $200 to $1000 monthly just to have a place to park your car ($2,400-$12,000/year). Some smaller cities don’t require you to pay anything monthly to park.


Japan also has substantial tolls to pay when using the expressways. A trip from Sendai to Morioka takes around two hours and will cost you more than $50 in tolls alone. In comparison, it would take around the same time to get from Cleveland to Columbus, OH, and you’ll end up paying $50, including gas.


Speaking of gas, gas prices as of right now in Tokyo are around $4.20. The highest gas price in America right now is $3.74, and that is in California. Most cars in Japan run around 35 mpg, which isn’t the greatest, but it’s serviceable. With a 30-liter gas tank, you could drive for 245 miles before filling up again.

If you wanted to take a trip from Tokyo to Hiroshima, you would end up paying $147.08 for gas and $294.18 worth of tolls. All in all, you’ve spent $441.26 for a trip that equals the distance from Sacramento to San Diego.