Thursday, May 07, 2009
Office of Fair Trading launches Used Car study
The OFT has today launched a short market study into the sale of second-hand cars.
The study follows concerns about the large number of consumer complaints relating to the sector. Last year, more than 68,000 consumers complained to Consumer Direct about issues with second-hand car sales. Concerns around defective vehicles, services and potentially misleading selling are consistently among the top complaints to the government-funded advice service.
The second-hand car market is large, with sales of approximately £35 billion in 2008, and the level of harm appears substantial: the financial cost of car clocking alone is estimated to be £100 million per annum.
The purpose of the study is to understand the causes of such high levels of consumer complaints and to consider whether existing consumer protection legislation is sufficient and effective in this sector.
The study will focus on sales by dealers rather than private sales between individuals, but the findings will aim to provide clarity across the wider second-hand car market. The OFT hopes to work closely with the second-hand car industry, local authority Trading Standards Services, consumer bodies and other interested parties.
John Fingleton, OFT Chief Executive, said: 'Buying a second-hand car is a major and potentially difficult purchase, given the fact that many consumers lack the necessary experience or knowledge to make an informed buying decision. We aim, particularly given the current financial climate, to look at the entire process for consumers when buying a second-hand car and whether existing regulation delivers sufficient robustness, confidence and clarity for both the customer and car dealer.'
The OFT expects to complete the work by the end of the year. The OFT will be contacting key parties directly; other interested parties can submit written views by 5 June to second-handcars@oft.gsi.gov.uk.
DATED: 07.05.09
FEED: AW
