Nissan Motor aims to start a small-scale driverless ride service in Japan in about three years as part of a move to use the technology to make up for a shrinking number of taxi drivers, it said on Wednesday.

Nissan hopes to begin offering what is known as Level 4 autonomous driving services in three or four municipalities in Japan, including in rural areas, by the financial year starting April 2027.

In the lead-up to that programme, the automaker will conduct a trial in Japan's second-biggest city of Yokohama with as many as 20 remodelled Serena minivans over the coming years.

Rival manufacturers including Honda Motor, Nippon Telegraph and Telephone and Toyota Motor are stepping up their interest in driverless services, developing the technology amid a rapid ageing of Japan's population.

Honda said in October it would set up a joint venture with General Motors and its robotaxi unit Cruise in the first half of this year as it seeks to begin a driverless ride service in Japan in early 2026.

Days after that announcement, Cruise suspended its U.S. operations following an accident in San Francisco, where one of its robotaxis dragged a pedestrian struck by another car.

Nissan will conduct its initial trial in Yokohama at Level 2 autonomy and the vehicles will have a safety driver on board, Kazuhiro Doi, corporate vice-president of Nissan Research and Advanced Engineering, told reporters. (Reporting by Daniel Leussink Editing by Mark Potter)