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Japan cuts Tesla EV subsidies by 40% starting January 2027

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Japan will cut subsidies under its Clean Energy Vehicle (CEV) program by approximately 40% for vehicles newly registered on or after January 1, 2027, according to the Ministry of Economy, Trade and Industry (METI). The government expects the current subsidy budget to be exhausted before the final application deadline of February 12, 2027, so it is lowering incentive amounts to keep subsidies available for longer. For the Model 3 and Model Y, including the Performance versions and the Model Y L, the subsidy drops from ¥1,270,000 to ¥762,000.…

🔎 Why it matters: The cut from ¥1,270,000 to ¥762,000 on the Model 3 and Model Y raises the cost of these vehicles in Japan for buyers who register them from January 1, 2027.
📈 Upside: The government keeps the program available for longer by reducing each incentive instead of exhausting the budget early.
📉 Risk: Buyers who register after January 1, 2027 will receive the reduced subsidy, and the final application deadline is February 12, 2027.
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