The world of car dealerships can be intimidating and confusing for consumers.
With such variation between dealerships, their processes, and their administration, it can be ambiguous as to who they answer to, and what rules, if any, they must follow.
When consumers have an issue with a car dealer, they are often left bewildered about where they should go to for advice. Do they go to the dealership itself, or the head office if the dealership is part of a larger group?
Is there a regulatory body, which promises completely unbiased advice and guidance?
The answer is yes.
So who does regulate car dealers in the UK?
Car dealers within the UK have to operate within the Consumer Rights Act, which in itself promises a high level of customer protection. They can also be regulated by trade associations – organisations founded and funded by businesses in the industry.
Each trade association presents its dealers with a code of practice that they have to adhere to, or face having their membership revoked. They also provide a conciliation or arbitration service. This acts as a go-between to help the consumer and the garage or dealership sort any issues out.
So how do you know if a dealership is a member of an association? Many dealerships will display the logo of their trade association on their paperwork, or within their premises. If it’s not immediately apparent, then ask the dealer outright or contact the trade associations and ask them if they are a member – most associations will have a search facility on their website.
While it is not obligatory for dealerships to join trade associations, it is equally beneficial for them as it is their customers. Trade associations provide a voice for the dealer in the industry, alongside long-term financial benefits such as free advice or discounted access to other services.
There are four main trade associations within the UK car and motorcycle industry: Motor Codes Limited, the Retail Motor Industry Federation, the Motor Cycle Industry Association and the Scotland Motor Trade Association.
Motor Codes operates three Codes of Practice, which aim to raise and maintain standards across the industry.
The first is the New Car code, which regulates the advertising, sale, warranty, replacement parts availability and complaint handling processes for 99 per cent of all new cars sold in the UK.
The second represents about 70% of the industry’s major providers that administer over three million products. Named the Vehicle Warranty Product Code, it covers a wide range of automotive warranty and insurance products, providing protection and advice.
And finally, most importantly for consumers, the Service and Repair code helps motorists to identify responsible garages and offers a structured complaints procedure and promotes good customer service. More than 6,500 garages in the UK subscribe to the Code.
How car dealers work
Car dealers work through a combination of traditional showrooms and online marketplaces – known within the industry as bricks and clicks. The latter is an example of them doing their best to move with their times.?
Statistics show that buyers spend far less time visiting dealers in their local area than ever before, preferring to research the car they want online, and only talking to their local salesperson once they know what they can get within their price range.
How some car dealers can trick you
Car dealers can take advantage of customers’ trusting natures and trick them in a number of ways.
Of course, that’s not to say that all car dealers are dishonest and untrustworthy, however it’s advisable to keep an eye out for common techniques and misleading terms and conditions.
One of the most basic, yet prolific tricks is advertising a car for an extremely low price online, only for the customer to visit the dealership to find that it has already been sold or is not as described. The dealers will then suggest similar models that have much higher prices.
Another favourite at dealerships is to exaggerate the interest in a model. Customers may feel more pressured to buy the car if the dealer tells them there is a long line of people waiting to look at it.
When you decide to buy a new vehicle, you may enquire about part-exchanging your current car. Great news, the dealer may offer you far more than you were expecting. However, be wary at this point, because this may affect any discount on the new car. A £2,000 offer for a car worth £1,500 will immediately draw in the buyer, however the dealer may remove a £500 cash discount he had previously offered on the new car.
If you decide to purchase a car on finance rather than outright, make sure you read all the terms and conditions thoroughly. Thanks to clever techniques used by salespeople, offers can appear far more attractive than they actually are. Sometimes, these offers are only available for a certain amount of time, which can again be used to pressure consumers into buying a car without thinking it through or looking elsewhere.
The multiple-point checks offered by many dealerships are also something to be wary of. While consumers may feel like they provide additional guarantee that the vehicle is in good working order, they can often include a number of purely cosmetic points, which make no difference to the running of the model.
And finally, just as you’re about to sign the papers, the salesperson may make one last chance to increase their aftersales profit margins.
Paintwork protection and technology warranties will be offered, extras that you really can’t go without, the dealer claims. Don’t feel pressured into adding these, but if you are interested in such policies, investigate them in detail before agreeing to anything.
With these tips we hope you will be better informed about where you stand with car dealers from now on, and ready to progress to the next step of your car-buying journey. For more, read our informative article on exactly what you need to know when buying a new or used car.
After completing his university studies in English and Creative Writing in Cardiff, Jack is now a full time motoring writer at Blackball Media. His love of cars stems from his childhood years when he began to live and breathe all-things automotive.