AM Online

Dealers ‘hiding’ service restrictions in the small print

New car buyers are being warned of alleged unscrupulous tactics being used by car manufacturers and franchise dealers to avoid block exemption regulations.

The Automotive Distribution Federation has highlighted regulations referring to the manufacturers' warranties that are inclusively supplied when the vehicle is purchased. However, some warranties are not provided by the manufacturers but by their dealers and are, in fact, insurance policies, it says.

Such policies can include clauses requiring the new owner to use only the franchised dealer network for servicing during the period of both the warranty and the policy.

Some vehicles are supplied using various forms of finance; leasing, contract hire and other 'personal mobility' plans. The agreements for these finance arrangements may also contain restrictive clauses concerning servicing outside the dealer network.

ADF chief executive Brian Spratt says: "This is a ploy designed to rob the consumer of the hard-won rights granted under the block exemption regulations.

Although we are discussing these activities with the Office of Fair Trading, the watchword for the present is, if you are buying a new car, 'read the small print."

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