As major automakers pare back their EV offerings, Sony and Honda are scrapping their plans to launch a gadget-packed electric vehicle.
The move by Sony Honda Mobility comes weeks after Honda announced a $15.7-billion writedown of its EV business and said it would cancel planned production for three of its own electric models.
Sony Honda Mobility is discontinuing the development and launch of the Afeela 1, a roughly $100,000 electric sedan stuffed with screens, speakers and AI. The car was set to hit the roads exclusively in California later this year.
“This decision follows discussions between our parent companies, after taking into account the significant impact of Honda’s EV strategy change,” said Akiko Itoga, director of public relations for Sony Honda Mobility.
“The discontinuation of these [Honda] models significantly impacts Sony Honda Mobility of America in pursuing a viable business case,” she said.
In a release on Wednesday, the company said it wouldn’t “be able to utilize certain technologies and assets that were originally planned,” because of the sudden change in Honda’s plans.
The company will issue refunds to customers who paid $200 to reserve a vehicle. It did not disclose the number of reservation holders.
Earlier this month, Honda reported its first annual loss in nearly 70 years as a listed company. It is not the only automaker to struggle with losses on EVs.
Ford took a $19.5-billion writedown and discontinued its electric pickup F-150 Lightning last year. Stellantis, maker of Jeep, Ram and others, took a $26.5-billion hit after shifting away from EVs in February.
“The way the market is looking right now, it makes sense they shut down,” said Kristin Shaw, an auto industry analyst and writer. “It’s a matter of timing.”
The companies could still work together in the future, she said.
Despite a predicted uptick in EV interest driven by sky-high gas prices, the market isn’t welcoming for newcomers at the moment. The average price of gas in California was $5.83, according to AAA.
“Afeela might be shelved or it might be trashed,” Shaw said. “Right now, it’s not going to work.”
The creators of Afeela were trying to make a car, entertainment system and personal assistant in one. The discontinued vehicles were to have 28 speakers, wraparound screens, an AI assistant and an entertainment system for Karaoke or playing Sony PlayStation games.
The company was also trying to achieve full autonomy in its vehicles. The Afeela 1 was equipped with 18 cameras, nine radars, 12 ultrasonic sensors and lidar — allowing it to qualify for level two autonomy, which requires a driver in control.
President Trump has rolled back EV incentives and requirements for automakers to sell green vehicles, leading to fewer options and declining public interest.
Tesla, the most popular EV in the country, is pivoting toward AI and autonomous driving tech as its EV sales lose steam. It discontinued its Model S and X in January. The company also lost swaths of customers last year as Chief Executive Elon Musk’s reputation suffered.
Sony Honda Mobility said it will continue discussions with Sony and Honda regarding future plans. Sony isn’t the only tech company that tried to break into the electric vehicle market — Apple worked on an EV for more than 10 years before shutting down in 2024.
