Car market shifts gears: EVs outpace used Japanese vehicles
Sri Lanka’s vehicle market is seeing a dramatic shift, just months after the government lifted the long-standing vehicle import ban in February 2025.
While many expected Japanese reconditioned vehicles to flood the market once again, what actually happened is quite different: electric vehicles and brand-new Chinese cars are now taking the lead, leaving used Japanese car dealers struggling to keep up, several vehicle sales centre owners said.
Since the ban was eased, more than 14,000 vehicles have been brought into the country, according to Customs data, generating around Rs. 165 billion in tax revenue.
But what’s surprising is the makeup of those imports. Rather than the familiar used Toyotas and Hondas, its electric vehicles—especially from Chinese brands like BYD and MG—are gaining traction.
Electric cars are gaining popularity among Sri Lankan consumers who now take into consideration more than the initial cost.
The Vehicle Importers Association Lanka (VIAL) has urged the public to exercise caution while purchasing electric vehicles (EVs). VIAL President Indika Sampath Merenchige stressed that although EVs are presently popular, especially after the import ban was lifted, new issues now confront buyers.
He noted that except for major established EV brands, a large number of Chinese EVs were immediately imported, many of which have lost Rs. 2–3 million in value shortly after purchase. EV dealers reject the claim and say these accusations are essentially because these car dealers have lost their market.
Simultaneously, brand-new cars—predominantly produced by Chinese brands—are capturing market share in their sleek looks, contemporary features, and affordable prices.
Conversely, Japanese reconditioned cars, which were the most popular pick among Sri Lankans, are experiencing slower sales.
While the exact number of Japanese used vehicles imported is not specified, a shipment of 196 vehicles, including popular Japanese models like Land Cruisers and Hilux cabs, was cleared in March
Many of the imported used vehicles remain unsold, as buyers seem to be prioritising newer models or switching to EVs altogether, car sale centre owners claimed.
“Earlier, people would come looking for a five-year-old Prius or Vitz. Now, they ask about charging times and battery life,” one Colombo-based car dealer said. The Vehicle Importers’ Association reported that 75 per cent of the initial 7,000 imported cars were sold, but it does not specify if those were primarily Japanese reconditioned vehicles.
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