According to a report in Reuters, a group of Hyundai Motor dealers has filed a lawsuit against the South Korean automobile manufacturer in Chicago federal court, alleging the company inflated sales numbers for electric vehicles and penalized franchises that did not participate in the scheme. The lawsuit, initiated by Napleton Aurora Imports in Illinois and related franchises, claims Hyundai Motor America Corp (HMA) pressured dealers to misuse inventory codes intended for “loaner” vehicles to exaggerate their sales data.
According to the lawsuit, dealers who complied with the improper coding were rewarded with wholesale and retail price discounts and other incentives by Hyundai. In response, Hyundai stated on Monday that it does not condone falsifying sales data and has launched an investigation following the allegations. The company also mentioned it is pursuing litigation in South Florida to terminate two Napleton-affiliated franchises connected to a criminal sexual battery allegation.
An attorney representing the Napleton plaintiffs declined to comment on Monday. The Chicago complaint accuses Hyundai of fraud and violating the Robinson-Patman Act, a federal antitrust law prohibiting price discrimination by sellers. The lawsuit claims dealers who cooperated received additional inventory of high-demand Hyundai models, reducing customer choice and enabling Hyundai to present inflated sales figures to the public and investors.
The complaint asserts that Hyundai’s reported sales-volume growth for electric vehicles misled the public into believing the demand was market-driven. It describes a scheme where HMA allegedly induced dealers to report false sales instead of relying on genuine consumer demand and desirable vehicles. The lawsuit references a phone call from a Hyundai district sales manager who stated the need to achieve sales numbers for media and corporate reporting.
The dealers claim they were denied benefits from Hyundai and seek unspecified damages for lost sales, revenue, and profit. In a related history, Napleton reached a confidential settlement with Chrysler in 2019 after suing the automaker in 2016 over similar allegations of inflated sales figures. Chrysler denied the claims but agreed in a related action to pay $40 million to the U.S. Securities and Exchange Commission to settle accusations of misleading investors with inflated monthly sales figures.
