Supercar Sales Complaints & Rejection Claims Soar

With demand for Luxury and supercars outstripping supply, provenance and quality are the inevitable casualties of increasing prices as dealers rush to ride the Supercar Bull Market.

This has led to a disproportionate rise in consumer rights complaints, car rejections and litigation, exacerbated by many Supercars being sold on HP and often by way of an unregulated hire purchase agreement.

Ferrari, Porsche, Audi and Lamborghini

Most supercar clients who have sought to reject a car have been the owners of Ferrari and Porsche vehicles, with Audi R8 and Lamborghini close behind, from a mix of main dealers and independent car dealers.

Although there have been a range of different causes for complaint, there has been a distinct increase in cases involving vehicles with a hidden, or more accurately, an undisclosed history.

This usually involves previous poorly repaired collision damage, which was not carried out under the terms of an insurance policy and therefore is not recorded on HPI.

To the uninitiated, the tell-tale signs such as irregular panel gaps, paint edges in the door shuts, around door handles and glass go unnoticed and only become evident after taking delivery, often when the car is submitted for servicing, detailing, or valeting.

However, this knowledge and information is part and parcel of the stock in trade of a professional car dealer.

Moral Hazard

Another common trick is known as the “moral hazard.” This is where the dealer is not incentivised to properly prepare and repair a supercar before its sold, because of the availability of an insurance-backed third party warranty sold with the vehicle.

The principle is simple, in that in many cases the Consumer Rights Act provides for the “right to repair” giving the dealer a second chance to ensure the vehicle is of the requisite satisfactory quality and to mitigate the costs of doing so by persuading the customer to claim the warranty.

Understandably insurance and warranty companies are acutely aware of this well-worn trick of the trade and often include a deferment period in the policy, restricting claims within the first 30 days for example. Most, if not all, include a clause obviating liability in circumstances where it is apparent the issue is historical.

Notwithstanding this, what may be minor maintenance issues on the average car, can be significant defects on a supercar. The highly and finely tuned thoroughbred engine, transmission and suspension are vulnerable to inadequate servicing, perished seals, and oil quality.

The moral hazard extends to circumstances where the motor car is sold by way of an unregulated hire purchase agreement. Here, the dealer sells the car to the finance company who in turn sells it to the customer. This means the dealer is not a party to a contract with the end-user.

What Next?

While it does not remove the potential liability of the dealer to the finance company, this really does nothing to assist the end-user. Nevertheless, there are other potential courses of action in misrepresentation and/or misstatement, or breach of statutory duty.

When the profit opportunity goes up, the con is on. If you’ve bought a Ferrari, Porsche, Audi R8 or Lamborghini which is not up to scratch, call the car lawyer on 03337007676.

Stormcatcher Law is widely regarded as the pre-eminent firm for Luxury and Supercar car purchase problems, rejection, and automotive fraud-related matters.

We have unsurpassed expertise and experience in the motor trade and specifically regarding the restoration and sale of rare, high value and collectable supercars, both in the UK and internationally.

We are regulated and authorised by the Financial Conduct Authority to provide advice, investigation and/or representation in relation to financial services or financial product claims.