Sony Honda Mobility, the joint venture formed by the two Japanese conglomerates, has determined to abandon the two electric vehicles under the “Afeela” brand that it has spent the last few years developing.
The decision comes after Honda announced earlier this month that it was doing a major about-face and canceling three electric vehicles planned for the US market – a decision that could cost the Japanese automaker nearly $16 billion. Honda blamed President Trump’s tariffs and increasing competition from China as reasons for this decision.
Sony Honda Mobility said on Wednesday it planned to use “certain technologies and components” from Honda to build and support the Afeela sedan and SUV, and that the Japanese automaker’s shift in strategy left the joint venture in a position where it can no longer develop the vehicles. The Afeela 1 sedan was due to go on sale later this year with an impressive starting price of around $90,000.
It’s not clear what will happen after the joint venture or the several hundred employees it has in Tokyo and California. Sony Honda Mobility (SHM) said in a press release on Wednesday that it will “continue to discuss and evaluate the future” of the joint venture with Sony and Honda, and that the parties will “jointly announce SHM’s future direction, medium to long-term positioning and contribution to the future of mobility as soon as possible.”
The world first learned of Sony’s interest in building a car at the 2020 Consumer Electronics Show, when the electronics giant released a concept vehicle called the Vision-S at at the end of his keynote presentation. The car was a big surprise, and even Sony seemed surprised by how much attention the prototype received.
At the time, it seemed that the Vision-S was intended to be a showcase for Sony’s entertainment and electronics prowess. It featured a screen that stretches across the dashboard, 360° audio, screens for the rear passengers and a suite of 33 sensors around the car. “This prototype embodies our contribution to the future of mobility,” said then-Sony CEO Kenichiro Yoshida during the event.
The Vision-S was also supposed to be a performance vehicle, built on top of a platform provided by major automotive supplier Magna. It was never entirely clear if Sony originally intended to go after an actual vehicle. But in 2022 it announced a tie-up with Honda and committed to building the sedan and an SUV variant. In 2023, the two companies unveiled the Afeela brand.
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The US electric vehicle market has changed dramatically since then, spurred by tariffs and the Trump administration’s rollback of laws that encouraged electric vehicle adoption. Multiple electric-only start-ups have gone out of business. Others they have rotated in hybrids and delayed their release. Major automakers have canceled plans for several electric vehicles under development. The federal EV tax credit is gone, though government subsidies remain.
However, the market opportunity for Afeela EVs looked suspect long before Honda’s big announcement this month. The joint venture was coming into a market already crowded with sharper-branded luxury vehicles (like Rivian) and impressive technology (like Lucid Motors). The past decade has proven that starting a new and viable US auto company is an extremely difficult endeavor, even for companies with strong institutional support.
