Sony Honda Mobility said on Wednesday it will stop developing its Afeela electric vehicles after Honda scaled back its EV strategy, leaving the joint venture without a viable path to bring the models to market. Honda earlier this month said it would take a writedown of up to 2. 5 trillion yen ($15. 7 billion) as it reduces EV investments, a move expected to result in its first annual loss in nearly 70 years as a listed company. The rollback comes as EV demand in Europe has been weaker than expected and policy support in the United States has been reduced under President Donald Trump. Automakers including Ford and Stellantis have also recorded significant writedowns.
Sony Honda Mobility said Honda’s revised strategy meant it could no longer rely on key technologies and assets from the automaker, making Afeela unviable. The venture will refund customers in California who had reserved the Afeela 1 and will continue discussions with Sony and Honda on future plans. Deliveries of the Afeela 1 had been scheduled to begin in California later this year, with a second model based on a newer prototype targeted from 2028.
Orders for the Afeela 1 opened last year with prices starting at $89,900.
The decision makes Sony the latest technology company to exit the EV space, underlining the difficulty new entrants face in a market led by Tesla and Chinese manufacturers. Apple ended its EV project more than two years ago, while Chinese firm Xiaomi has proceeded with its SU7 sedan. Travis Lundy of Quiddity Advisors said before the announcement that the Afeela project was unlikely to succeed and did not align with Honda’s long-term priorities.
Honda said the move would not materially affect its consolidated financial outlook for the fiscal year ending this month. Sony also said the impact on its financial position would be limited. Sony Honda Mobility was set up to combine Honda’s manufacturing capabilities with Sony’s software and entertainment technologies to compete in the EV market.
