MANNING LEAVER LEGAL LANE CNCDA Sues Volkswagen and Honda Over Scout and Afeela Vehicles By Joseph Berberich, Partner, Manning, Leaver, Bruder & Berberich LLP Two major manufacturers are preparing to sell vehicles directly to consumers in California without using franchised new motor vehicle dealers in a clear violation of California law. Acting through Volkswagen entities, Scout Motors, a Volkswagen affiliate, plans to commence sales of Scout vehicles in 2027. Sony Honda Mobility of America, a joint venture between Honda and Sony, plans to start selling its Afeela vehicles in the spring of 2026. Scout Vehicles On Oct. 24, 2024, Scout Motors announced its plans to manufacture a Scout Traveler SUV and a Scout Terra pickup truck with initial production targeted for 2027. Scout Motors says it is an independent startup and will have an exclusive Scout Motors retail network. It plans to build dedicated retail facilities called Scout Studios to engage customers and Scout Workshops for vehicle service needs. Scout Motors, a DMV-licensed manufacturer and Scout Motors Sales, a DMV-licensed vehicle dealer, plan to sell Scout vehicles directly to customers without using the new motor vehicle franchise model of independent new motor vehicle dealers who purchase vehicles from manufacturers and sell them to customers. Scout Motors’ website, www.scoutmotors.com, is one of the ways Scout Motors markets its company and its vehicles. The website advertises the anticipated prices of the Scout Traveler and Terra vehicles and provides detailed information about the vehicles and Scout Motors. On its website, Scout Motors solicits customers to pay $100 to reserve a Scout vehicle for purchase or lease and provides an online reservation system for interested customers. It is reported that Scout has received over 50,000 reservations. Afeela Vehicles On March 4, 2022, Sony Group Corporation and Honda Motor Co. Ltd. issued a news release announcing they had signed a memorandum of understanding outlining their intent to establish a joint venture to develop high-value-added electric vehicles (EVs). The announcement stated: “This alliance aims to bring together Honda’s mobility development capabilities, vehicle body manufacturing technology and after-sales service management experience cultivated over many years, with Sony’s expertise in the development and application of imaging, sensing, telecommunication, network and entertainment technologies ...” The announcement further said: “The new company is expected to plan, design, develop and sell the EVs, but not own and operate the manufacturing facilities, so Honda is expected to be responsible for manufacturing the first EV model at its manufacturing plant. It is expected that a mobility service platform will be developed by Sony and made available to the new company.” Honda and Sony formed Sony Honda Mobility of America in 2023 and has both a manufacturer and a vehicle dealer DMV license. It is actively marketing its Afeela vehicles on its website at www.shm-afeela.com and in many other ways. It solicits customers through its website to pay a $200 fee to reserve a purchase of the vehicle. Like Scout, Sony Honda plans to sell its vehicles directly to customers without using independent, franchised new motor vehicle dealers. Afeela vehicles will be serviced by Crash Champions, which has an extensive network of vehicle collision repair locations. Sony Honda will begin pre-delivery preparations in the spring of 2026. 16 California New Car Dealer Quarterly
RkJQdWJsaXNoZXIy MTg3NDExNQ==