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 to even bother owning a car there.
Why is it so expensive to own a car in Japan? Japan requires multiple annual car inspections, parking spot fees, additional acquisition taxes when purchasing a car, and annual inspections for cars older than 10 years. 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 is 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.
This table below will provide the overall costs of owning and if you would like more information on what some of these costs are I will provide you with more information following the table.
|White Plate||Yellow Plate|
|Cost of a Car (used)||240,000 – 300,000 yen||160,000 – 220,000 yen|
|Cost of a Car (new)||1,000,000 yen and up||under 1,000,000 yen|
|Automobile Acquisition Tax||5% of the price of the car|
|Automobile Tonnage Tax (based on weight)||50,000 – 75,000 yen||under 50,000 yen|
|Name Change||10,000 – 25,000 yen||3,000 yen|
|Shaken||120,000 yen and up||70,000 – 100,000 yen|
|Older-Than-10-Year-Inspection||(from 10,000 yen up to half the price of your shaken)|
|Compulsory Third Party Insurance||(included with shaken)|
|Mandatory Liability Insurance (per year)||30,000 yen||20,000 yen|
|Optional Insurance (per year)||40,000 – 70,000 yen|
|Automobile Tax (per year, depending on size)||30,000 – 50,000 yen||5,000 – 20,000 yen|
|Gasoline (about 4000 yen per tank)||about 110 yen per liter|
|Permanent Parking Space (per month)||0 yen (in the countryside) – 20,000 yen (in the big city)|
|Short-term Parking||100 – 500 yen per hour; 500 – 5000 yen per day|
|Other Maintenance||0 – 50,000 yen per year|
This table is courtesy of www.supermelf.com.
White and Yellow Plate Cars
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.
Obtaining a Japanese Drivers License
Japan has a drivers test just like any other country but it’s passing rate is very low and the process is grueling and expensive. Drivers are required to attend a Drivers Education School that costs around $3,000 USD.
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.com mentions that “The most important thing about the test is not to get frustrated with the ridiculousness of the test.(Supremelf)”
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 taxing 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 prnewswire.com who accredit their information to Kelly Blue Book. Lucky for the Japanese, new White Plate cars start at around $9,201 US Dollars 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 USD to around $690 USD. This adds another $1,100+ USD to the several thousand you just paid for your car.
You also have to factor in a Name Change for your car which can range from $27 to $250 USD.
Every two years in Japan, cars have to go through a process entitled Shaken. Shaken 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 every two years to have your car inspected. The process includes wheel alignment, speedometer inspection, brake inspection, exhaust inspection, undercarriage and suspension inspection, and an inspection to ensure that all cars meet Japanese Exterior Regulations.
This process can run you around $644 to $1,612 USD 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 can not 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.
Japanese Car Insurance
Much like in America, Japanese drivers must have a proper drivers license and car insurance. The average cost of car insurance in America according to thezebra.com is around $1,426 dollars per year. This is average for your liability insurance as well as the other perks that you would receive in your Nationwide, Progressive or State Farm plans.
Japanese car insurance isn’t too far off from American prices. Mandatory Liability Insurance starts at around $200/year in USD and the additional insurance you get to cover more than just liability can begin at around $600/year in USD.
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.
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.
Americans are likely used to paying for valet parking, parking passes, parking meters, or parking garages but there is nothing hindering us from parking in our own driveways for free. This isn’t always the case in Japan.
The Japanese require a proof of parking spot or garage when they attempt to purchase a car and this is a monthly payment. In cities on the outskirts of larger cities containing around 300K people, parking runs at around $83 USD monthly which adds up to about $996 USD 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). I will mention that 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. To put it in simpler terms, It would take around the same time to get from Cleveland, OH to Columbus, OH and you’re paying $50 on top of 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 for $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.
- Singapore is the most expensive place to purchase and own a car. Owners have to have a Certificate of Entitlement that could cost $50,000 to $70,000 yearly. There are also other charges such as registration fees, insurance, and goods and services charges.
- New York City is the most expensive city in America to own a car. According to Fortune.com (https://fortune.com/2018/04/10/expensive-cities-car-ownership/), car owners pay around $19,000 for owning a car in a city where most people use taxis.
- Kim Jong Ill once banned all Japanese made motors from North Korea after coming across a broken-down Japanese car blocking the road. Yes, this is a real story.
- 8% of Japan’s population have made careers in vehicle production. This makes sense given that Japanese cars make up 30% of the worlds car market. Check out more facts from hotcars.com.
- Japanese Drivers have to sport a green and yellow sticker on their car to signal that they have recently begun driving. No lying that you’ve had your license for a while in Japan. They make it known you’re new to the roads.
- Japanese drivers flash their hazard lights to say thank you to other drivers. I’ve definitely had someone turn their brights on behind me but I’m almost 100% certain they weren’t saying thank you.
- It is common practice to run red lights in Japan but you can’t turn left on red. I guess they haven’t incorporated traffic cameras yet. Also worth mentioning that they drive on the left side of the road. Their left on red is our right on red.
If you are interested, here is a travel guide to the globe on Amazon.