WSG warns that dealers lack clear guidance on fault investigation times before buyers can reject cars under the Consumer Rights Act, risking refund demands.

Car dealers are being urged to seek clearer guidance on how long they have to investigate faults before a buyer can reject a vehicle under the Consumer Rights Act, according to the Wholesale Suppliers Group (WSG). Without precise timescales, many dealers face refund claims before they can repair the car.

WSG representative speaking about dealer fault investigation guidance

Key takeaways

WSG says dealers need clearer fault investigation times.
Current guidance under the Consumer Rights Act is ambiguous.
Refund demands are arising before repair work can begin.
Dealers risk cash flow pressure without clear rules.
Industry calls for regulatory clarification.

Current challenge for dealers

When a customer identifies a fault, the dealer must decide whether to repair or accept a rejection. The Consumer Rights Act allows a buyer to reject a vehicle if the fault is not remedied within a reasonable time, but the law does not specify that period. This uncertainty leaves dealers uncertain about how to respond without risking a refund claim.

Many dealers report receiving demand letters for refunds before they have had the opportunity to undertake diagnostic checks or arrange parts. The resulting disputes can delay sales, increase administrative costs and affect profitability, especially for smaller independent operators.

WSG's warning

The Wholesale Suppliers Group has highlighted the gap in guidance as a pressing issue for the trade. In its statement, WSG emphasised that without a clear timescale, dealers cannot confidently manage warranty and repair obligations while protecting their financial position.

WSG also noted that the lack of uniform advice creates inconsistency across the market, with some dealers adopting overly cautious approaches that lead to unnecessary refunds, while others risk consumer complaints by waiting too long.

Call for clearer guidance

Industry bodies are urging the government and the Competition and Markets Authority to issue specific timeframes for fault investigation under the Consumer Rights Act. Clear rules would help standardise practice and reduce the number of early refund demands.

Such guidance would also allow dealers to plan resource allocation more effectively, ensuring that diagnostic and repair work can be scheduled within a known window, thereby protecting both customer satisfaction and dealer cash flow.

What this means for dealers

Dealers should review their current fault handling procedures and document any internal timelines they use. By having a transparent policy, they can demonstrate to customers and advisers that they are acting within a reasonable period, even if formal guidance is still pending.

In the meantime, maintaining detailed records of investigations and repair attempts will be crucial if a dispute reaches a tribunal. Clear evidence of prompt action can support a dealer’s case against premature refund claims.

Frequently asked questions

How long can a dealer take to investigate a fault before a buyer can reject the car?

The Consumer Rights Act does not set a fixed number of days for fault investigation. Dealers must act within a "reasonable time," which is currently open to interpretation. Industry bodies like WSG are urging regulators to define explicit timeframes to provide certainty.

What steps can dealers take now to protect themselves from early refund demands?

Dealers should keep thorough records of all diagnostic work, communicate clearly with customers about expected timelines, and apply a consistent internal policy for investigations. Documenting each step can demonstrate that the dealer acted promptly should a dispute arise.