Japanese market demand for continuously variable transmissions is projected to reach 1.2 million units per year within five years, a report on WardsAuto.com said.

That would be the equivalent of about a quarter of the number of front-wheel-drive cars sold annually in Japan, the website added.

WardsAuto.com said that sales of CVT-equipped vehicles exceeded 500,000 last year with over half in the mini and subcompact vehicle segments with engine displacements ranging from 660cc (Japan's Kei-car class norm) to 1.5 litres.

With Nissan in the lead, the industry is primed to move steadily into the two-litre and above segments, WardsAuto.com said.

Nissan has already begun to introduce CVT-equipped cars outside Japan. Its recently redesigned UK-built Primera range sold in Europe includes two-litre petrol models with CVT transmission.