Japan's cutesy 'kei cars' hit rocky road

Yoko Kojima loves zipping around Tokyo in her Daihatsu Tanto with its tiny wheels and pint-sized engine, but Japan's beloved 'kei cars' may have a rocky road ahead despite a legion of loyal fans.

Sales of the cutesy box-shaped cars, a staple of the world's number three vehicle market, drove off a cliff after peaking at 2.27 million units in 2014.

The drop to 1.72 million vehicles sold last year was a response by cost-conscious drivers as the government -- looking to pay down a massive national debt -- jacked up taxes on the popular made-in-Japan vehicles.

It was a nasty shock for many kei drivers, the majority of whom are women and those in rural areas where the little vehicles are indispensable for getting around on the cheap.

"I don't see a bright future for kei cars," said Yoshiaki Kawano, analyst at IHS Markit consultancy, who added that a consumption tax rise planned for 2019 could also dent kei sales.

"It's an ageing society and rural areas are losing residents -- where kei cars are most popular," he added.

There's no doubt that keis - short for kei jidosha, or light cars in Japanese - still have plenty of fans who love their great fuel economy and modest price tag.

They make up more than one-third of the domestic market, with Honda releasing the newest version of its top-selling N-Box kei car this week.

"You can maneuver the car even if the streets are really narrow," said 75-year-old Kojima, whose Tanto doubles as a van for her part-time flower delivery business.