Importing Your Dream Car From Japan Is Dirt Cheap Right Now, But There’s A Catch

If you’ve been sitting on buying and importing a car from Japan, I have good news. Due to exchange rates between the Japanese yen and the United States dollar, your dream car may now be cheaper to attain than you ever remember. Now is the best time to get out there and buy your JDM-love. However, you should know there’s some bad news about the cars you’ll find in Japan.

Yesterday, Matt Hardigree and I read a report from CNBC stating that “The Japanese yen weakened to 160 against the U.S. dollar in Monday morning trading in Asia.” The yen has been pretty weak for a while, resulting in some fun cars going for cheap prices in Japanese auctions. CNBC says: “The yen has traded around 150 or weaker against the dollar since the Bank of Japan ended its negative interest rate regime in March.”

Now, we’re not financial analysts here, so I’m not going to dive into the history of the strength of the yen. The Japanese economy is going through some big changes and the company’s stock market is surging. If you want to understand more you can listen to this episode of Odd Lots that gets into more detail.

What I will say is that I’ve been monitoring the prices of cars sold in Japanese auctions against exchange rates for a long time. In 2021, I imported two cars from Japan. My Honda Beat went for around 200,000 yen, and the charge to my account was $1,910 before fees and importation costs.

In 2021, it was pretty easy to do a very rough conversion rate. A car sold for 200,000 yen was roughly $2,000.

Now, times have changed. Your 1 U.S. dollar currently has the buying power of 157.80 yen in Japan. What does that mean in plain English? A 200,000 yen car is now worth the equivalent of $1,270. That is a price drop large enough that, if you budgeted $5,000, you should be able to cover most, if not all of the rest of your importation expenses! Of course, that varies by situation, but it’s a pretty big deal.

So, what kind of cars can you buy for a lot less dough than before? Let’s look at the trifecta of Kei sports cars, the Honda Beat, the Suzuki Cappucino, and the Autozam AZ-1. As a note, I have paid access to Japan’s auction systems. Any links I could provide would be behind a pricy paywall.

Honda Beat

Here’s my favorite of the trifecta, and a car that’s in my own fleet. The Honda Beat is such a great car not just because it has a heartwarming story, but also because it drives oh so close to the original NSX, but on a fraction of the budget. In some ways, the Beat is even better than the NSX, with its zebra-themed interior and drop-top roof. Plus, actual Americans can fit in them! This was the last car to get the stamp of approval from Soichiro Honda, and currently, all Beats are legal for importation.

My Beat was $1,910 and came with the optional upgraded factory stereo, yellow paint, and optional fog lights. Sadly, the zebra seats have been lost to time and the soft top had seen far better days. There’s also a pesky rust spot I need to fix.

Here’s a 1991 Honda Beat with a condition grade rating of 4 and the equivalent of 86,991 miles. It is considered to be in a condition that’s more or less daily driver grade and it sold for 567,000¥, or just $3,640.

My Beat was given a far lower grade of RA with inspection reports noting repaired damage. This grade 4 Beat didn’t even have easily visible rust!

Maybe you don’t mind spinning some wrenches on your imported car. I have you covered. Another 1991 Honda Beat rolled across the auction block with a grade 3 condition report and 109,361 miles. Now, this one has some really questionable modifications like a backward hood scoop (with the hood being in the rear, as that’s where the engine is), a garish steering wheel, and lots of red bits that don’t belong.

The attached report also noted that the roof is a little worn and the body has scratches and marks. But you know what? It sold for the equivalent of $850! For that price I wouldn’t even care. Even that car had less rust than my more expensive Beat.

If you really want to roll the dice, I found a Beat with an odometer discrepancy, a roof leak, a bad air-conditioner, and a torn interior that sold for just $450. These are cars that sell for around $8,000 or more after landing in America. Forget that, just import one yourself!

Autozam AZ-1

Ok, so the Beat might not be for you, I get that. What about the Autozam AZ-1? This thing is basically the closest thing you’ll find to a Kei class supercar, as described by Jason:

Autozam is a sub-brand of Mazda, one they use for their Kei-class cars and small cars, often re-branded Suzukis. The Suzuki connection is significant here, because the AZ-1’s inspiration came from a 1985 Suzuki concept car called the R/S1, or maybe R/S-1, or some other combination. I’ve seen a lot of variants online.

However you add slashes or dashes to the name, the R/S1 was a very sporty mid-engined car, light and nimble. The concept of a small, fun sports car appealed to Mazda, heady on the fumes of Japan’s Bubble Era, and by 1989 they had three concepts of their own to show, the AZ-550 cars, Types A, B, and C. Of the three concepts, Type A was the closest to the production AZ-1, with its gullwing doors and supercar-after-a-cold-shower proportions. Type B was a little hardtop convertible, sort of like a Honda Beat, and C was supposed to be a little Group C rally car.

Toshiko Hirai, the same person behind the development of the NA Miata, was put in charge of the project, which should be a good reminder that the AZ-1 was never intended to be some kind of joke, a Kei car dressed up in a racing suit. Sure, it had to meet the Kei class restrictions of the era – a 660cc engine making a maximum of 64hp and a very specific and restrictive size envelope – but within those parameters, Mazda intended to build an actual supercar.

Gary Duncan, a friend of the site, will ask you to pay over $27,000 for one of these, which is sort of insane for a car that can’t even comfortably fit an average American. But hold the phone, because if you skip the middleman you can save a ton of cash.

A pretty rough 1993 Autozam AZ-1 recently sold for the equivalent of $6,420.

Now, this car was definitely more of a project. Its front bumper was scratched up, its paint was dull, and the interior was a hodgepodge of unsightly mods. I found a nicer 1994 for example for a still-affordable $9,700. With that said, really nice, stock examples still sell for $13,000 or more, but they’re still way cheaper than nearly $30,000.

Suzuki Cappuccino

Weirdly, the Cappuccino is the only member of the Kei sports car trifecta that we haven’t written a proper history about. For many, the Cap is the best of the three. It’s not as roomy as a Beat or as wild as an AZ-1, but it is known for making the most of its 63 HP. Yes, all of these cars make about the same power, but the driving experience of the Cappuccino is often compared favorably to the other two.

The Suzuki Cappuccino was developed from the start to be a pocket-sized sports car. The idea was that buyers would have all of the thrill of a pure sports car, but in a more affordable form factor that took advantage of Japan’s Kei class.

Sure, the Cap has just a 657cc triple under the hood. Yes, and I mean really under the hood. Unlike the Beat and AZ-1, the Cappuccino does not have a mid-rear-mounted engine. However, don’t think it doesn’t mean business. That engine has a turbo pumping out 12.8 pounds of boost and the engine revs to 9,300 RPM before finally cutting out. The rear-wheel drive convertible also weighs just 1,497 pounds, so those 63 ponies can feel more like racehorses. Cappuccinos have 50/50 weight distribution with two occupants inside, removable roof panels, all disc brakes, and all-aluminum double wishbone suspension.

Let’s skip to the good stuff. Recent sales data shows a Cappuccino in more or less daily driver condition to have found a new home for $3,044. One in even better shape went for $3,577. A Suzuki Cappucino that was a bit beat but still ran sold for $1,775.

If you buy a Suzuki Cappuccino that’s already in America, you can expect to pay $10,000 or more. Duncan Imports wants about $26,000 for a low-mileage example in its possession. Again, you could save a lot of cash by skipping the dealer and working with an importer.

It’s not just limited to Kei vehicles, either. I’ve found Toyota Century limos with glorious V12 engines sell for just $2,600 and even ones in good shape still sell for around $10,000. Maybe you want a Mazda RX-7 FD? Statistics show those have been selling consistently for under $20,000. Largely just rare examples are selling for more.

I think I got the point across here. If you want to buy your dream Japanese import, now might be the time to pounce on it. However, there is a catch.

It’s Hard Finding A Good Car

Japan’s auction systems are wild, and I don’t just mean with the cars you’ll find. On one hand, auctions in Japan are often better than the ones here in America. I don’t get condition reports at my local auctions!

That said, there is a dark and confusing side to Japan’s auction systems. While most cars will come with a pretty detailed condition report, you cannot always trust the reports. First, here’s how to read condition grades, from Elite Auto Export Japan:

S – The car is less than 12 months old from the first registration date and under 10,000km. As good as new. The exterior and interior are in immaculate condition.

6 – The car is less than 36 months old from the first registration date and under 30,000km. Basically a very late model and new car.

5 – The car is under 50,000km. The exterior may have some very minor scratches/scrapes and dents. A very difficult grade to obtain, the unit will be in near perfect condition with very minor imperfections.

4.5 – The car is under 100,000km. Again, a very high grade that you can be confident in. The car may have some very slight imperfections in the body work, but will not need major repair. Grade 6,5 and 4.5 are the top grades you could expect for a used car, and as such attract the top prices in the top 10%.

4– The car is under 150,000km. The exterior may have some scratches/scrapes and dents. The car is in above average condition. No Crash history. The interior may have some tears, cigarette burn marks, and/or stains. They will require some minor repair. The auction sheet will tell us in more detail.

Generally a 4 grade car is a good target and the most popular for export. Price range will be in the top 30%.

3.5 – The exterior has some noticeable large scratches/scrapes and/or large dents. They may require some minor panel beating work and/or painting.

The interior may have many tears, cigarette burn marks, and/or stains. They will require repairs. Auction sheet will explain in more detail. The car is in average condition taking in to consideration the year and ks on the car.

3 – The exterior has many noticeable large scratches/scrapes, paint blemishes, and/or large dents. They will require major panel beating work and/or painting.

The interior has many tears, cigarette burn marks, and/or stains. They will require many repairs and/or interior parts will need to be replaced.

2 – The car is in very poor condition and often denotes the presence of corrosion holes – PASS!

1 – The car which has one or more of the following:

1. An aftermarket turbo
2. An automatic transmission converted to manual transmission
3. Flood damage
4. Fire extinguisher damage

RA – The car which has had accident damage which can be ranked MINOR, and has been repaired.

R – The car has had accident damage and has been repaired. The auction definition “A car which has had accident damage” is a car that has accident damage to the following area(s) which parts were repaired or replaced : 1. Lower Tie Bar or Frame 2. Windshield Pillar (A Pillar) 3. Center Pillar (B Pillar) 4. Rear Pillar (C Pillar) 5. Strut Housing 6. Roof Panel 7. Trunk flooring Panel 8. Floor Pan. These cars can be good buying, and the repair work can be of top standard. Thorough inspection at auction and the car can be purchased if the repair is good. Repair may be invisible…or could be bad! We will be onsite to check and give you our opinion.

Generally speaking, a 25-year-old or older car rated 4.5 will be the best example you can find. These will sell for oodles of cash and don’t be surprised to see them at Bring a Trailer for even more money once they land stateside.

On the other end of the spectrum is a car that wasn’t assigned a condition grade. This car may not have been inspected, or worse, it could be such a large pile of junk that it couldn’t even be given a grade. A car rated 3.5 should be a daily driver.

Unfortunately, condition grades are subjective. The person grading a car that should be a 3.5 might grade it as an R and a car that should be an R might be graded as a 3.5. For example, my Honda Beat was graded as RA because it had a supposedly bent core support. The “bend” was found to be a slightly dented recovery hook, almost certainly from entering or exiting a parking lot. On the other hand, I found a Toyota Century with a 3.5 grade that was noted to have an oil leak so bad that it couldn’t even be loaded onto a boat.

So, it pays to get an independent inspection. I recommend working with an actual importer or an export company with good resources. They’ll charge you a fee on top of your actual costs, but they can help you not import a total rustbucket. Personally, The Import Guys did an amazing job with helping me choose and buy my Honda Beat. Japan Car Direct was a blast to work with on my Suzuki Every. JCD charged about $650 on top of actual costs and The Import Guys charged $1,000 on top.

Unfortunately, this does mean your $800 Kei car becomes much closer to about $3,000 or $4,000 by the time it lands in America, but that’s still pretty cheap.

There’s one more thing, too. Cars have been leaving Japan in droves. Gary Duncan has literally hundreds of imports in his collection, including well over 100 Nissan Figaros. That’s just one person. Pretty much everyone and their grandma is getting into Japanese imports right now, so the best examples are getting scooped up as soon as they appear. That leaves you sifting through pages and pages of rustbuckets waiting to give you a major headache. It’s a misconception that cars in Japan don’t rust as badly as they do in America. Oh yeah, they’ll rot out just as bad or worse as the cars here at home. So, be careful.

In my experience, this also means you may have to wait to find the car you want. Most of the cars I featured here were possible gems in a sea of rusty, poorly-modified cars. You may remember that last year I said I wanted to import a few specific cars from Japan. Well, it’s been over a year and I still haven’t found the one I’m willing to roll the dice on.

So, your favorite car is out there and can probably be had cheap, but you may have to wait for it. If you don’t mind drooling at your computer screen for a while, you can still get a good deal. So get out there and start shopping!

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