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Dealers providing services under new Consumer Rights Act

Our last blog looked at the sale of vehicles under the new Consumer Rights Act 2015, a massive shake-up of consumer rights law that simplifies, strengthens and modernises previous legislation. In this blog, we look at how the Act covers services provided by motor dealers and what retailers can do to protect themselves.

For more information on the new Act, read our blog: Are you ready for the Consumer Rights Act 2015?

How does the Act cover dealer services?

To understand how motor dealers are affected by the changes, we must first look at the Act’s key clauses on the provision of a service. Under the new rules, services must be:

  • done within a reasonable time
  • performed in line with information provided by the dealer
  • done with reasonable skill and care
  • carried out in accordance with service information.

If a dealer fails to meet these requirements, a customer can ask for a repeat of the service at no further cost – meaning the dealer would pay for labour and materials. Equally, a customer can ask to pay less if a service is delayed, does not meet the standards defined in pre-supplied information or wasn’t carried out with due care and skill. Of course, the requirements cover all services offered by the dealer, such as setting up insurance or finance.

The reduction in price can be up to 100%; however, the reduction is normally the difference in value between the service the consumer paid for and the service they received. Any refunds must be given within 14 days and using the same means of payment the customer used (unless agreed otherwise).

Clauses in pre-sale information cannot exclude liability for:

  • failure to perform a service with reasonable care and skill, or;
  • being in accordance with information provided about the service, or;
  • limit liability to below the contract price.

Furthermore, if a vehicle breaks down hundreds of miles from where the initial work was carried out but the breakdown is due to a problem with the service, the consumer could be entitled to claim the cost of work carried out by a different trader.

Protection for motor dealers

Ensuring your sales and service teams are fully versed in the Consumer Rights Act 2015 is essential and the key to protecting your business from false, speculative or dishonest claims. It is important to remember that customers cannot make a claim under the Act:

  • if the service does not achieve the consumer’s desired outcome (unless that outcome is agreed first)
  • where the customer is responsible for disappointing results, for example: on insisting on short cuts or inappropriate materials to save money
  • for damage the customer causes or for faults that appear from wear and tear
  • if they change their mind about wanting a service.

There are a few measures motor dealers can take to prevent unnecessary problems or losses should their customers exercise their new legal rights under the Act:

  • ensure procedures are in place for the provision of pre-sale information and how any issues are presented to customers, so they know what to expect from a service
  • train the sales team to deal with customers asserting their new rights, including documenting faults brought to their attention by customers
  • review their complaints handling procedure and company terms and conditions. A review of returns policies is also advisable as well as liability clauses in service contracts
  • review agreements with subcontractors, agents and manufacturers and consider the impact of any liabilities on contractual supply agreements and risk to avoid any undue exposure due to faulty products.

If you have any questions about the Consumer Rights Act 2015 and how it could affect your dealership, contact Car Care Plan.

Click here to read the full Consumer Rights Act 2015. Alternatively, for detailed information and examples, visit www.citizensadvice.org.uk or call 03454 04 05 06.

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