Sony, Honda Put Brakes on Electric Vehicle JV

By Fabiana Negrin Ochoa

Sony Group and Honda Motor are pumping the brakes on a venture that had aimed to make high-end electric vehicles.

Sony Honda Mobility--a joint venture between the two Japanese companies--has decided to discontinue the development and launch of its first model, the Afeela 1, as well as a second vehicle that had been under development.

The program was established during 2022 at the peak of EV fever, and Sony's then-CEO, Kenichiro Yoshida, had expressed high hopes for the venture, expecting the car market to increasingly shift to a service model where customers pay regularly for software downloads and entertainment.

On Wednesday, SHM said that since its inception, it has aimed to make high-value-added mobility products that combine the technologies and expertise of Sony and Honda.

However, due to Honda's reassessment of its electrification strategy, SHM won't be able to use certain technologies and assets originally planned to be provided by the carmaker, and no longer has a viable path to bring the vehicles to market, it said.

Earlier this month, Honda said it expects to swing to its first annual loss in decades due to $15.7 billion in expenses and losses related to the reassessment of its EV strategy. The automaker said it decided to cancel the launches and development of certain models in response to a slowdown in the North American EV market.

Honda said Wednesday that it doesn't expect the joint venture's halt to have a material impact on its forecasts for the fiscal year ending in March.

Meanwhile, Sony said it is evaluating the impact of the discontinuation on its operations and financial position for the fiscal years ending March 2026 and 2027. But as SHM has been operating under a asset-light approach, Sony said it believes the impact won't be significant.

The move comes shortly after Sony Honda Mobility of America announced the grand opening of the Afeela studio and delivery hub in California. SHM said it will issue refunds of reservation fees for Afeela 1 vehicles in California.

The three companies will continue to discuss SHM's future business direction and provide updates when available.

Write to Fabiana Negrin Ochoa at fabiana.negrinochoa@wsj.com

(END) Dow Jones Newswires

March 25, 2026 06:32 ET (10:32 GMT)