Why Carro’s $60M Funding Could Shift the Balance for Japanese Cars in Asia

Singapore’s automotive unicorn is leveraging investor backing to drive plug-in hybrid adoption and reshape the online car market in Southeast Asia.

Singapore-based online car platform Carro has raised $60 million in a funding round led by Japan’s sovereign wealth fund, Cool Japan Fund, alongside participation from several new investors. The investment reflects strong confidence in Carro’s plans to broaden its presence across the Asia-Pacific region and drive greater demand for Japanese vehicles.

The startup plans to channel this investment primarily toward promoting plug-in hybrid electric vehicles (PHEVs), aiming to increase the market share of Japanese cars in the region. Carro’s leadership believes this move will make it Southeast Asia’s largest online used-car platform while it is expected to strengthen the broader adoption of hybrid and electric vehicles in the region.

Japanese Cars: A Legacy Driving Future Growth

“Japanese automakers have always had a strong presence and historical dominance in Asia Pacific,” said Carro Co-founder and CEO Aaron Tan. He emphasized that Japanese vehicles remain reliable, technologically advanced, and safe, featuring innovations such as fuel cells. “We are confident that we can expand the market share of Japanese PHEVs in the near future,” Tan noted.

This confidence is backed by macroeconomic trends:

• Rising demand for used and hybrid vehicles: Southeast Asia’s expanding middle class, coupled with growing awareness of environmental sustainability, is creating new demand for hybrid vehicles.
  
• Government incentives: Countries like Indonesia and Thailand are offering subsidies for electric and hybrid cars, further supporting the market.

Cool Japan Fund: Strategic Backing for Japan’s Automotive Exports

Kenichi Kawasaki, President, CEO, and COO of Cool Japan Fund, said the investment aligns with the fund’s goal of boosting overseas demand for Japanese products and technologies. “Through this investment in Carro, Cool Japan Fund aims to boost demand for Japanese cars in the region and reinforce their value by showcasing Japan’s advanced automotive technologies,” he said.

Founded in 2013, Cool Japan Fund is a government-backed private fund that provides risk capital to promote Japanese products and services internationally. Its portfolio spans food and beverage, lifestyle, media and content, and advanced technology sectors. 

Carro: From Marketplace to Automotive Ecosystem

Carro has grown from a simple online car marketplace into a full-fledged automotive ecosystem, handling more than 100,000 vehicle transactions each year across seven markets, including Indonesia, Thailand, Hong Kong, Singapore, Taiwan, Japan, and Malaysia. In addition to vehicle sales, the company provides auto fintech services, digital insurance solutions, and after-sales support, establishing itself as a comprehensive platform for both consumers and dealers.

Key highlights of Carro’s business model:

• Enables both consumers and dealers to buy and sell vehicles online
• Offers financing, insurance, and post-sale support
• Leverages data and technology to optimize vehicle pricing and transactions
  

CEO Aaron Tan recently revealed plans for expansion into Australia and a potential dual listing, signaling ambitions beyond the Asia-Pacific market.

The Bigger Picture: Asia’s AutoTech Revolution

Carro’s growth comes amid a broader automotive transformation in Asia. The region is witnessing:

• Increased digital adoption in car buying and selling
• A shift toward hybrid and electric vehicles supported by government incentives
• Investor interest in platforms that combine technology with automotive commerce

Carro, backed by investors such as SoftBank Group and Temasek, could become the first major automotive tech and commerce unicorn from Singapore to go public in the U.S., with a potential valuation of over $3 billion. This move would mark the largest Southeast Asian listing in the U.S. since Sea’s debut in 2017.

Conclusion: 

Carro’s $60 million funding is more than just capital—it represents a strategic push to reshape the automotive landscape in Asia-Pacific. By promoting Japanese plug-in hybrid electric vehicles, the startup is betting on technology, sustainability, and regional demand trends. With strong backing from Cool Japan Fund and global investors, Carro is well-positioned to strengthen its market dominance while driving the next wave of automotive innovation in Southeast Asia.