ACCC accuses Honda of misleading customers and harming two agencies

The consumer watchdog has filed a lawsuit in Federal Court against Honda Australia, accusing the automaker of misleading customers and harming two former authorized dealerships.

The Australian Competition and Consumer Commission (ACCC) is accusing Honda Australia – which is owned by Japanese car maker Honda Motor – of making false or misleading statements to customers.

It claims that from January to June of last year, Honda Australia misled customers by telling them that two authorized dealerships had closed or would be closed and that these dealers could not service Hondas.

However, Honda had already breached its contracts with the Astoria Brighton in Victoria and Tynan Motors in New South Wales just two years after their franchise agreements.

Customers were contacted by Honda via text messages, emails and phone calls between January and June of last year.

Example Honda Australia text message to Astoria and Tynan customers.

However, in reality, car dealerships continue to independently trade and service vehicles.

Some customers have been told that their vehicle warranties will only be valid if they service their vehicle at an authorized dealership.

“We allege that Honda has denied customers the opportunity to make an informed decision about their vehicle service options, in favor of a Honda associated dealership, which may be less convenient or more expensive for them,” said Lisa Carver, Commissioner of Canada’s Competition and Immigration Commission.

“We also allege that Honda has caused harm to Astoria and Tynan, by falsely claiming that they have closed or will close, which could result in customers having their Honda serviced elsewhere.”

Last year, ABC reported Astoria’s “David-and-Goliath” legal battle against Honda for compensation after the car brand broke its contract.

Astoria co-owner Mark Avis told ABC that Honda used the Astoria database to send SMS and email messages to 34,000 customers, instructing them to transfer their business to the remaining dealers.

Having resolved several other related court cases, Astoria and Tynan have now filed suit in the High Court of Victoria.

Those actions used internal Honda Australia documents to say the company did not disclose its plans to terminate a number of authorized dealerships before renewing its five-year franchise agreements in 2018.

The allegation states that Astoria and Tynan suffered loss and damage through their inability to earn money by being an Authorized Honda Dealer or an Authorized Honda Parts and Service Dealer, nor the ability to sell the business as a Honda franchise.

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