A group of Hyundai dealers is suing the South Korean automaker in Chicago federal court. They are alleging Hyundai intentionally inflated electric vehicle sales numbers and punished dealers who refused to participate in the deception. From Reuters:
The lawsuit filed on Friday by Napleton Aurora Imports in Illinois and affiliated franchises, said Hyundai Motor America Corp (HMA) pressured dealers to misuse inventory codes meant for “loaner” vehicles to exaggerate their sales figures.
Dealers that agreed to improperly code the vehicles were rewarded by Hyundai with wholesale and retail price discounts and other incentives, according to the lawsuit.
Hyundai said in a statement on Monday that it does not condone falsifying sales data and had opened an investigation after it was alerted to the allegations.
The company also said it has been pursuing litigation in South Florida to terminate two Napleton-affiliated franchises there tied to a criminal sexual battery allegation.
The complaint accused Hyundai of fraud and violating the Robinson-Patman Act. For those of you who don’t know, it’s a federal antitrust law that bars sellers from discriminating on the basis of price:
Dealers that “played ball,” according to the lawsuit, would receive extra inventory of faster selling Hyundai models. The lawsuit said the scheme put desirable inventory in the hands of fewer dealers, depriving customers of choice, while helping Hyundai tout rosy sales figures to the public and investors.
It said Hyundai has emphasized its sales-volume growth for electric vehicles, leading the public to believe demand was market driven.
“Instead of organic growth fueled by desirable vehicles and consumer demand, HMA created a multitiered scheme to cause its dealers to report false sales,” the complaint said.
The lawsuit cited statements on a phone call from a Hyundai district sales manager who said “we gotta hit a number for the press and for the Koreans.”
Hey! That’s us! We’re “the press.”
The dealers said they have been denied benefits from Hyundai and asked the court to award an unspecified amount of damages to cover lost sales, revenue and profit.
This isn’t the first time Napleton Aurora Imports took on an automaker. Back in 2019, they reached a confidential settlement with Chrysler for allegedly scheming to inflate sales numbers. The automaker has since denied the claims.
Time will tell if what is alleged of Hyundai is true or not, but if it is, it’s going to rock a big chunk of the automotive world.
A version of this article originally appeared on Jalopnik’s The Morning Shift.