This is an example of a modern "Kei Car". You can tell it's a kei car by the yellow license plate. The engine size is 660cc. Here is a quote from Wikipedia on exactly what a kei car is.
Kei car, K-car, or keijidōsha (軽自動車, lit. "light automobile") (pronounced [keːdʑidoːɕa]), is a Japanese category of small vehicles, including passenger cars, vans, and pickup trucks. They are designed to comply with Japanese government tax and insurance regulations, and in most rural areas are exempted from the requirement to certify that adequate parking is available for the vehicle. This especially advantaged class of cars was developed to promote popular motorization in the post war era. While successful in Japan, the genre is generally too specialized and too small to be profitable in export markets.
Modern Kei Cars are actually pretty roomy. They don't usually feel underpowered since most of the driving you will be doing in Japan is either in traffic or on single lane roads. I myself like the turbo or super charged kei cars for that extra "get-up-and-go".