Sri Lanka’s auto market has been rocked by a post-ban revolution. Once dominated by refurbished Japanese vehicles, it’s now Chinese electric cars like BYD and MG that are electrifying the roads. Here’s why Sri Lankans are ditching Toyotas for Teslas and what you need to watch out for before buying.
Sri Lanka’s automobile market is undergoing a seismic shift just months after the government lifted its long-standing vehicle import ban in February 2025.
Contrary to widespread expectations that refurbished Japanese cars would once again dominate, the current wave of vehicle imports is being led by electric vehicles particularly those from Chinese manufacturers like BYD and MG. Several dealership owners have confirmed that Japanese used car sales are now lagging behind.
According to data from Sri Lanka Customs, over 14,000 vehicles have been brought into the country since the ban was lifted, contributing approximately Rs. 165 billion in tax revenue. However, the real surprise lies in what these imports consist of.
Instead of the familiar secondhand Toyotas and Hondas, the market is now abuzz with sleek, modern, and affordable electric vehicles. Consumer interest in EVs has skyrocketed, signaling a major turning point for the local auto industry.
The Sri Lanka Vehicle Importers Association, however, is urging the public to approach the EV boom with caution.
Association president Indika Sampath Merenchige noted that while electric vehicles are enjoying a surge in popularity post-ban, many buyers are encountering new challenges. He warned that aside from well-established EV brands, a flood of lesser-known Chinese models has entered the market and many of these vehicles have reportedly depreciated by Rs. 2 to 3 million shortly after purchase.
Electric vehicle dealers have pushed back against this claim, arguing that traditional dealers are only raising concerns because they’re rapidly losing market share to newer, tech-savvy competitors.
Indeed, the latest models, mostly Chinese are impressing Sri Lankan consumers with their futuristic design, cutting-edge features, and attractive price tags.
In stark contrast, the once-popular reconditioned Japanese cars are now seeing sluggish sales. Although specific numbers weren’t provided for Japanese imports, it was confirmed that a batch of 196 vehicles—including high-demand models like the Toyota Land Cruiser and Hilux was released from customs in March.
Yet, many of these used vehicles remain unsold. Dealership owners say that customers are now more focused on battery capacity and charging time than on mileage and fuel efficiency.
“Previously, customers would ask for a 5-year-old Prius or a Vitz,” said one Colombo-based dealer. “Today, they’re asking about range, fast-charging, and whether the car has regenerative braking.”
The Vehicle Importers Association reported that 75% of the 7,000 new cars imported were sold. However, it did not specify if these were predominantly Japanese or electric vehicles.
As the industry rapidly evolves, Sri Lanka’s car buyers are clearly signaling a new era one where electricity, not gasoline, powers both engines and market demand.
