Sony Honda Afeela EV Direct Sales Model Faces Lawsuit from California Dealers

Sony Honda Mobility's direct sales model for the Afeela EV is facing a lawsuit from California franchised dealers who claim the approach strips consumers of protections like local service support, transparent pricing, and warranty assistance. The conflict between franchisees and automakers pursuing direct sales has been ongoing since Tesla began selling cars directly. Sony Honda Mobility belongs to an established automaker with an existing retail network, making this lawsuit significant.

Sony Honda Mobility, a joint venture between Sony Group and Honda Motor, is facing a lawsuit from the California New Car Dealers Association (CNCDA) over its direct sales model for the Afeela electric vehicle (EV). The association, representing over 1,400 franchised dealers in California, alleges that the company is violating state franchise laws by selling the Afeela 1 directly to consumers, bypassing Honda and Acura dealerships [1].

The lawsuit, filed on August 19 in Los Angeles County Superior Court, claims that Sony Honda Mobility is stripping consumers of vital protections such as local service support, transparent pricing, and warranty assistance [1]. CNCDA president Brian Maas stated, "This is a direct attack on the 161 franchised Honda and Acura dealers in California that have been loyal partners in building the brand’s reputation and success for decades" [1].

The Afeela 1, the first EV from the brand, is expected to arrive in early 2026 and is being built at Honda’s factory in Ohio [1]. Sony Honda Mobility has been taking deposits from California residents and marketing the EV through pop-up showrooms across the state [1]. The company maintains that it is a separate entity from Honda, but the association argues that the joint ownership and shared manufacturing establish an affiliation under California law [1].

The lawsuit against Sony Honda Mobility follows a similar action this year against Volkswagen Group and Scout Motors, which also sought to sell new EVs directly to California buyers [1]. Assembly Bill 473, passed in 2023, prohibits automakers from creating affiliated brands that compete directly with their franchised dealers [1].

The conflict between franchisees and automakers pursuing direct sales has been ongoing since Tesla began selling cars directly. Sony Honda Mobility, belonging to an established automaker with an existing retail network, makes this lawsuit significant [2]. The case is expected to have implications for other automakers considering similar direct sales models.

References:
[1] https://autos.yahoo.com/articles/sony-honda-sued-california-dealers-191717182.html
[2] https://asia.nikkei.com/business/automobiles/sony-honda-ev-venture-sued-in-us-for-bypassing-dealerships