Dealer Groups are Up In Arms About Potential for Scout and Sony Afeela to Sell Cars Directly to Buyers

by Chris Teague

Published: April 22nd, 2024

dealer groups are up in arms about potential for scout and sony afeela to sell cars

Dealers are often the first group to sound concerns when something changes in the auto industry, whether they’re justified in their complaints or not. Most recently, a state dealer association created an ad asking Volkswagen Group and Sony Honda Mobility not to sell their upcoming EVs outside of the existing dealer network over concerns the new divisions could follow Tesla and Rivian in selling directly to buyers.

The group placed an ad in the April 15 issue of Automotive News and has collected support from all 50 state and 21 metro-area dealer associations. They warned that federal and local laws could prohibit selling directly to consumers and said that the groups could pursue legal options if they attempted to do so.

Advocates for the groups have long complained that they’ve received no information from automakers after years of trying.

“After two years of asking and getting nothing, frustration is very high,” one person told Automotive News. “If they want to sell the vehicles direct, it’s going to be an incredibly difficult battle.”

Executives from the automakers have dodged questions about the situation, noting that they wanted to leave their options open as market conditions evolve. At the same time, VW is moving to bring the Cupra brand to the U.S., where it’s currently unclear how they’ll be sold.

While it’s hard to argue against the dealer system for owner support and servicing, it’s also hard to argue against more choices for buyers. Purchasing online or ordering a car can be a vastly better experience than trying to track down a model on a dealer’s lot and then negotiate a price anywhere near MSRP, so it will be interesting to see where the cards fall when the new brands arrive on the market.

[Image: T. Schneider/Shutterstock.com]

Become a TTAC insider. Get the latest news, features, TTAC takes, and everything else that gets to the truth about cars first by subscribing to our newsletter.

#VolkswagenGroup #scoutmotors #sonyafeela #CarDealers

Chris Teague

Chris grew up in, under, and around cars, but took the long way around to becoming an automotive writer. After a career in technology consulting and a trip through business school, Chris began writing about the automotive industry as a way to reconnect with his passion and get behind the wheel of a new car every week. He focuses on taking complex industry stories and making them digestible by any reader. Just don’t expect him to stay away from high-mileage Porsches.

More by Chris Teague

Comments

Join the conversation

2 of 17 comments

Jeff on Apr 22, 2024

“After two years of asking and getting nothing, frustration is very high,” one person told Automotive News. “If they want to sell the vehicles direct, it’s going to be an incredibly difficult battle.”

Works for Tesla.

Like Reply
Vatchy on Apr 24, 2024

What is the difference between a car dealer and a drug dealer? Not much - you can end up dead using what they sell you. The real difference is that one is legal and one is not.

Like Reply

Recent Comments

Varezhka I have still yet to see a Malibu on the road that didn't have a rental sticker. So yeah, GM probably lost money on every one they sold but kept it to boost their CAFE numbers.I'm personally happy that I no longer have to dread being "upgraded" to a Maxima or a Malibu anymore. And thankfully Altima is also on its way out.
Tassos Under incompetent, affirmative action hire Mary Barra, GM has been shooting itself in the foot on a daily basis.Whether the Malibu cancellation has been one of these shootings is NOT obvious at all.GM should be run as a PROFITABLE BUSINESS and NOT as an outfit that satisfies everybody and his mother in law's pet preferences.IF the Malibu was UNPROFITABLE, it SHOULD be canceled.More generally, if its SEGMENT is Unprofitable, and HALF the makers cancel their midsize sedans, not only will it lead to the SURVIVAL OF THE FITTEST ones, but the survivors will obviously be more profitable if the LOSERS were kept being produced and the SMALL PIE of midsize sedans would yield slim pickings for every participant.SO NO, I APPROVE of the demise of the unprofitable Malibu, and hope Nissan does the same to the Altima, Hyundai with the SOnata, Mazda with the Mazda 6, and as many others as it takes to make the REMAINING players, like the Excellent, sporty Accord and the Bulletproof Reliable, cheap to maintain CAMRY, more profitable and affordable.
GregLocock Car companies can only really sell cars that people who are new car buyers will pay a profitable price for. As it turns out fewer and fewer new car buyers want sedans. Large sedans can be nice to drive, certainly, but the number of new car buyers (the only ones that matter in this discussion) are prepared to sacrifice steering and handling for more obvious things like passenger and cargo space, or even some attempt at off roading. We know US new car buyers don't really care about handling because they fell for FWD in large cars.
Slavuta Why is everybody sweating? Like sedans? - go buy one. Better - 2. Let CRV/RAV rust on the dealer lot. I have 3 sedans on the driveway. My neighbor - 2. Neighbors on each of our other side - 8 SUVs.
Theflyersfan With sedans, especially, I wonder how many of those sales are to rental fleets. With the exception of the Civic and Accord, there are still rows of sedans mixed in with the RAV4s at every airport rental lot. I doubt the breakdown in sales is publicly published, so who knows... GM isn't out of the sedan business - Cadillac exists and I can't believe I'm typing this but they are actually decent - and I think they are making a huge mistake, especially if there's an extended oil price hike (cough...Iran...cough) and people want smaller and hybrids. But if one is only tied to the quarterly shareholder reports and not trends and the big picture, bad decisions like this get made.