The California New Car Dealers Association has filed a lawsuit against Honda Motor Co. and its Sony Honda Mobility division in Los Angeles County Superior Court, seeking to block further collection of $200 deposits for the upcoming Afeela 1 EV. The suit, filed on behalf of California’s 161 franchised Honda and Acura dealers, alleges unfair competition and unlawful sales.

The new vehicle is a luxury sedan developed by Honda in partnership with Sony. Deliveries are expected to begin in the second half of 2026. Sony Honda Mobility began accepting deposits from Californians in January.

CNCDA sent a cease-and-desist letter to the companies in May, claiming direct sales put Honda in competition with its dealers in violation of state franchise laws. A month earlier, the association sued Volkswagen in San Diego County in an effort to prevent the factory from selling its new Scout EVs directly to consumers.

In a press release, CNCDA President Brian Maas says direct sales circumvent “vital consumer protections” such as service availability, pricing transparency and warranty assistance and are an affront to manufacturers’ dealer partners.

“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,” Maas writes. “At the time of AB 473’s review by the California legislature, Sony Honda sought to block the (now) law that would make their direct sales of Afeela vehicles illegal. They are now knowingly violating the law, hoping they won’t be caught. It’s our job to protect the dealers who are directly harmed by their actions.”

Read more at CNCDA.org