Should the Consumer Rights Act be updated for software‑driven car faults? Dealers demand a US‑style lemon law

The Consumer Rights Act is facing fresh criticism as automotive experts argue that dealers are being asked to fix software‑related vehicle faults without the technical control or support they need.

In recent months, a growing chorus of motor‑trade retailers has highlighted how the legislation, introduced to protect car buyers, can leave dealers unfairly exposed when modern vehicles rely heavily on software, sensors and advanced driver‑assistance systems.

Warranty Solutions Group calls for a broader debate

Warranty Solutions Group (WSG) has joined the conversation, suggesting that the current framework places responsibility on the party with the least technical knowledge. WSG chief executive John Colinswood explained that a dealer can be tasked with resolving a customer’s problem while depending on an external source for the software, technical data, training or manufacturer support required to fix it.

“If the retailer doesn’t control the technology required to resolve a fault, we need to ask whether it is reasonable for all of the exposure to sit with the dealer,” Colinswood said during two Consumer Rights Act webinars hosted by WSG.

Industry bodies echo the concerns

The Institute of the Motor Industry (IMI) has also weighed in, arguing that responsibility for a fault should follow control. Professor Jim Saker, president of the IMI, asked: “Fundamentally, responsibility should follow control. If a fault originates within manufacturer software, or if a software update is required before a fault can be resolved, where does responsibility actually sit? Is that the responsibility of the retailer, or should it sit with the manufacturer that controls the software?”

He added that some manufacturers invest heavily in technical training, academy programmes and ongoing support, while others are still developing those capabilities. “If dealerships haven’t received the necessary training or technical information, they are placed in an extremely difficult position,” Saker warned.

Dealers push for a ‘lemon law’ approach

Used‑car dealers have long argued that the Consumer Rights Act is too blunt an instrument for the second‑hand market. Culloden Cars boss Craig Walker noted that the act treats a 13‑year‑old vehicle in the same way as a three‑year‑old one, despite the vastly different conditions and expectations of each.

Walker and other dealers are calling for a US‑style “lemon law” that would differentiate coverage by mileage and clearly specify which components are covered, providing a more nuanced safety net for both buyers and sellers.

Government response

The Department for Business and Trade, which oversees the Consumer Rights Act, maintains that the legislation is functioning as intended. A spokesperson told Car Dealer that “our consumer rights legislation helps people buy with confidence, while providing clear protections when things go wrong.” The department added that it continues to work with businesses to understand how regulations operate in practice and supports them through its Small Business Plan.

Despite the assurances, the ongoing debate suggests that the motor trade believes the law does not yet reflect the realities of today’s software‑centric vehicles.

What’s next for the legislation?

WSG’s webinars have sparked wider discussion about whether the Consumer Rights Act should be revised to allocate responsibility based on technical control rather than simply on the point of sale. As vehicle complexity grows, the pressure is likely to increase for a legislative update that balances consumer protection with the practical capabilities of dealers.

Stakeholders—including manufacturers, dealer groups and regulatory bodies—will need to collaborate on a solution that protects buyers while recognising the specialised knowledge required to diagnose and repair modern software faults.

For further reading, see the original article on Car Dealer Magazine.