Sony Honda Mobility, a joint venture between Honda Motor Co. and Sony Group Corp. that would have built EVs in the U.S. and sold them directly to consumers, has canceled its Afeela 1 sedan and a related CUV that were set to be delivered for the first time this year.

In a press release, executives say the models fell victim to declining demand for electric vehicles. Many manufacturers have been forced to retrench after spending billions in unreciprocated EV development costs.

“As a result of Honda’s reassessment of its automobile electrification strategy announced on March 12, 2026, SHM will not be able to utilize certain technologies and assets that were originally planned to be provided by Honda at the time of SHM’s initial business planning,” executives say. “In light of this change, SHM has determined that it does not have a viable path forward to bring the Models to market as originally planned.”

Last year, the California New Car Dealers Association sued Honda for circumventing its dealer network, alleging unfair competition and unlawful sales.

Read more at Sony Honda Mobility