Car on PCP: Can You Reject for Engine Failure?

An engine failure is one of the most serious faults a car can develop. On a Personal Contract Purchase agreement, it creates a specific set of legal and financial complications – because you do not own the vehicle outright, the finance company is the legal owner, and any resolution needs to account for the outstanding finance balance as well as the vehicle itself.

The short answer is yes: you can reject a car on PCP for engine failure, provided the failure amounts to a breach of the Consumer Rights Act 2015 and you act within the appropriate timeframe. See our faulty car bought on finance page for more information.

What the law requires

For a PCP rejection to succeed, the engine fault must mean the vehicle fails to conform to contract under the CRA. In practice, this means the car is not of satisfactory quality – a reasonable person would not consider a car with a failed engine to meet the standard they were entitled to expect at the time of purchase.

The key question in most engine failure cases is whether the fault was pre-existing at the point of sale. If the engine fails within six months of purchase, the law presumes it was defective at delivery – the dealer must prove otherwise. After six months, you must provide evidence that the failure was caused by a pre-existing defect rather than wear, misuse, or a separate event.

Common engine failures that support a PCP rejection claim

Not every engine failure has the same cause, and the strength of your claim partly depends on the nature of the failure. The following are among the most common issues that support rejection:

• Timing chain or timing belt failure on vehicles where the component is known to be defective on that make and model
• Turbocharger failure caused by oil starvation, which can indicate a pre-existing lubrication issue
• Crankshaft or connecting rod failure on vehicles with known manufacturing defects
• Head gasket failure on engines with a documented history of the problem at that mileage range
• Engine seizure caused by a pre-existing cooling system defect

If the manufacturer has issued a technical service bulletin (TSB) or recall notice related to the failure mode, this is powerful evidence that the fault was inherent rather than wear-related.

The timeline matters: where are you in the PCP agreement?

Within 30 days of delivery

You have the short-term right to reject under Section 20 of the CRA. Engine failure unambiguously satisfies the conformity test. Write to both the dealer and the finance company exercising this right and requesting a full refund.

31 days to 6 months

You are in the CRA’s intermediate period. The dealer is entitled to one repair attempt. If the engine failure is so severe that repair would be disproportionate, or if repair is not possible, you can proceed directly to a replacement or price reduction – or reject outright if neither is feasible.

After 6 months

You can still reject, but you must prove the defect was pre-existing. An independent engineer’s report is usually essential. If the failure is a known issue on your model, manufacturer documentation can corroborate the claim.

What happens to the outstanding PCP finance?

A successful rejection unwinds the finance agreement. The finance company receives the vehicle back. Any balance remaining after the return of the vehicle is offset against what you have already paid, and you should recover your deposit and instalments – less any legitimate deduction for use if you are past the short-term rejection window.

You should not simply stop making PCP payments during a dispute without legal advice, as this can trigger default proceedings and affect your credit record. A solicitor or lawyer can advise on protective steps while your claim is in progress.

What if the dealer says the failure was caused by poor maintenance?

This is a common dealer defence. The assertion that you caused the engine failure through neglect shifts the burden back to you. Your response should be evidence-based:

• Service records showing the vehicle was maintained in accordance with the manufacturer’s schedule
• Oil change receipts and mileage logs
• An independent engineer’s report confirming that the failure was not caused by maintenance neglect
• Manufacturer TSBs confirming the component is known to fail on this model regardless of maintenance

Can you reject even if the car has driven 20,000 miles on the PCP?

Mileage alone does not prevent a rejection claim, but it does affect the strength of your position. High mileage makes it harder to argue the fault was pre-existing, and any refund under the final right to reject will include a use deduction. If the engine failure is clearly linked to a manufacturing defect – such as a known timing chain problem – even a high-mileage vehicle can support a strong claim.

How Stormcatcher Law can help

PCP engine failure claims require a detailed understanding of both the legal framework and the mechanical evidence. Our lawyers are knowledgeable and in automotive engineering able to assess the cause of failure and build the strongest possible case. . Contact us for a free case assessment.