Classic Car Wiki

Introduction to Daihatsu

Daihatsu Motor Co., Ltd. is one of Japan’s oldest and most storied car manufacturers, known for its compact cars, innovative kei vehicles, and durable off-roaders. Though now a wholly owned subsidiary of Toyota Motor Corporation, Daihatsu maintains its distinct character and engineering heritage. With a reputation for producing small, efficient, and practical vehicles, Daihatsu has had a major influence on the development of Japan’s domestic automobile industry and made a lasting impact in markets across Asia, Europe, and beyond.

Founding and Early Years

Origins as Hatsudoki Seizo Co.

Daihatsu traces its roots to 1907, when it was founded as Hatsudoki Seizo Co., Ltd., a manufacturer of internal combustion engines, particularly for stationary and industrial use. The company was formed by professors from Osaka Technical College and quickly gained expertise in building small, reliable engines for utility and transportation applications.

Transition to Transportation

After World War I, Hatsudoki Seizo began shifting its focus to motorized vehicles, developing engines for small trucks and agricultural machinery. In 1930, the company unveiled its first vehicle—the HA three-wheeler, a small cargo vehicle powered by a 500cc engine. This lightweight design became the basis for future development and put Hatsudoki on a path toward automotive production.

The Birth of Daihatsu

Rebranding and Modernization

In 1951, the company officially changed its name to Daihatsu Motor Co., Ltd., combining the first character of “Osaka” (pronounced “Dai”) with “Hatsu” from Hatsudoki. The new name reflected a renewed focus on motor vehicles and expansion into the growing Japanese automotive market.

Embracing the Kei Car Segment

Post-war Japan saw an increasing need for affordable, efficient, and compact transportation. Daihatsu positioned itself perfectly to take advantage of the kei car class, a government-regulated category of ultra-compact cars designed for urban use. These cars were limited in size and engine capacity but offered tax and insurance benefits. Daihatsu would become one of the dominant players in this market.

Important Models and Milestones

Daihatsu Midget (1957–1972)

One of Daihatsu’s first major successes was the Midget, a tiny three-wheeled utility vehicle. Popular with small businesses and tradespeople, the Midget was a common sight in postwar Japanese towns. Its simple design and extreme maneuverability made it indispensable for deliveries and street vendors.

Daihatsu Fellow (1966–1970)

The Fellow was Daihatsu’s entry into four-wheeled passenger kei cars. Powered by a two-stroke engine, it represented the company’s commitment to small yet practical vehicles. The Fellow would evolve into several updated models and solidified Daihatsu’s position in the kei car sector.

Daihatsu Hijet (1960–present)

A landmark in commercial kei vehicles, the Hijet line of microvans and trucks became one of Daihatsu’s best-known products. Used for both commercial and agricultural purposes, the Hijet continues production to this day, with modern iterations featuring fuel-efficient engines and practical interior layouts.

Daihatsu Charade (1977–2000)

The Charade marked Daihatsu’s foray into subcompact cars for export markets. Offering impressive fuel economy and clever engineering, the Charade became a global hit and was even voted Japan’s Car of the Year in 1978. It gained popularity in Europe, Australia, and Asia as a reliable and economical urban car.

Daihatsu Cuore / Mira (1980–present)

The Mira (also marketed as the Cuore in some regions) became a mainstay of Daihatsu’s kei car lineup. Known for its small dimensions, nimble handling, and efficient powertrain, the Mira was popular with commuters, first-time car buyers, and city dwellers. It saw numerous upgrades across generations.

Daihatsu Rocky and Terios (1984–present)

Daihatsu also carved a niche in the compact SUV market. The **Rocky**, introduced in the 1980s, offered true off-road ability in a small package. Later models like the **Terios**, released in the late 1990s, targeted families seeking practical crossover-style SUVs. These vehicles helped broaden Daihatsu’s appeal globally.

International Expansion

Exporting to the World

Daihatsu began exporting vehicles in the 1960s, starting with Southeast Asia and gradually expanding into Europe, Australia, and South America. Its small, inexpensive vehicles fit the needs of many developing markets and proved especially successful in regions with narrow roads and congested cities.

European Market and Withdrawal

Daihatsu entered the European market in the 1980s, gaining a modest but loyal customer base. Models like the Charade, Cuore, and Terios found fans in countries like the UK, the Netherlands, and Germany. However, rising regulatory costs and currency pressures led Daihatsu to withdraw from Europe in 2013, redirecting focus to Asia and domestic operations.

Partnership with Toyota

Early Collaboration

Daihatsu had long enjoyed a close relationship with Toyota. The two companies began collaborating in the 1960s, with Daihatsu supplying small cars and engines to complement Toyota’s larger offerings. Toyota saw Daihatsu as a strategic partner for penetrating developing markets and the kei segment.

Acquisition and Subsidiary Status

In 1998, Toyota increased its stake in Daihatsu to become the majority shareholder. By 2016, Toyota made Daihatsu a wholly owned subsidiary. This move allowed for tighter integration of platforms, technologies, and global market strategies—especially in Southeast Asia.

Daihatsu’s Role in Emerging Markets

Under Toyota, Daihatsu focused on producing budget-oriented vehicles for developing economies. Models like the Daihatsu Ayla (sold under the Toyota Agya badge) in Indonesia and Daihatsu Sigra became key players in the low-cost car segment. Daihatsu’s modular platforms were instrumental in Toyota’s “Emerging-Market Compact Car Company” (EMCC).

Engineering Innovation

Lightweight Design Philosophy

Daihatsu has consistently pursued vehicle lightness as a design principle. This not only enhances fuel efficiency but also reduces wear and tear on parts and makes vehicles easier to handle. Even its compact off-roaders were engineered with a light frame for better maneuverability.

Turbocharged Kei Engines

To meet performance expectations within kei car limitations, Daihatsu engineered sophisticated three-cylinder turbocharged engines. These engines delivered impressive power relative to their size and made cars like the Mira TR-XX and Copen sporty and engaging to drive.

Daihatsu Copen (2002–present)

The Copen is Daihatsu’s most distinctive modern car—a tiny two-seater roadster with a retractable hardtop. Built within kei regulations, the Copen became a cult favorite for its styling, nimble handling, and surprising practicality. The second generation, introduced in 2014, featured a modular body system allowing interchangeable exterior panels.

Environmental and Technological Focus

Eco-Friendly Vehicles

Daihatsu has been proactive in developing low-emission vehicles and eco-friendly technologies. Many of its models boast class-leading fuel efficiency, and the company has introduced start-stop systems, CVTs, and hybrid technology in its domestic lineup.

Smart Assist Technology

Safety has become a major focus in recent years. Daihatsu’s **Smart Assist** system integrates radar, cameras, and sensors to help avoid collisions and assist with braking. It is now available in many of the company’s kei cars and has improved its appeal to a broader market.

Daihatsu Today

Focus on Southeast Asia

Today, Daihatsu is especially strong in Indonesia and Malaysia, where it operates major production facilities and sells cars under both the Daihatsu and Toyota badges. Vehicles like the Xenia, Ayla, and Sigra dominate their segments and reflect Daihatsu’s understanding of cost-effective manufacturing and local preferences.

Production and Strategy

Daihatsu remains a leader in kei car production in Japan. It continues to develop new platforms that can be used across both the Daihatsu and Toyota lineups. The company’s DNGA (Daihatsu New Global Architecture) platform supports modular design for small cars and supports Toyota’s global small car strategy.

Conclusion

Daihatsu’s journey from a small engine manufacturer to one of Japan’s most beloved makers of compact cars is a testament to its innovative spirit, engineering discipline, and focus on everyday practicality. With a legacy built on mobility for the masses, the company carved out a lasting niche in both the kei and compact car worlds.

Now integrated into Toyota’s global operations, Daihatsu continues to influence how small cars are designed and built for the future. Its vehicles remain symbols of efficient, no-nonsense transportation that doesn’t sacrifice character or reliability. The story of Daihatsu is not just one of cars, but of adapting to change while staying true to a distinct vision of what transportation can be.