All major makes of new car in the UK will in the future be sold without servicing ties as part of their warranties, following action by the OFT.
The remaining manufacturers whose new car warranties included servicing ties have all now lifted their servicing restrictions. Consumers will now be able to choose freely where they have their new car serviced.
The move comes after an OFT study into new car warranties found that the 'dealer-based extended warranties' offered by many manufacturers included terms requiring that new cars be serviced at a garage belonging to the manufacturer's franchised dealer network, limiting consumers' ability to choose where to have their car serviced.
The OFT recommended that the industry lift these ties to improve consumer choice and aid the development of more effective competition in the car after-sales market.
John Vickers, OFT Chairman, said:
'The car industry's response to the OFT's recommendations to remove
servicing restrictions is good news. Consumers should now benefit from
increased choice and competition between franchised and independent garages.'
The lifting of the ties has avoided the possibility of formal action by the OFT under EC competition law.
Franchised dealers have been carrying out around 90 per cent of servicing of cars up to three years old. However, servicing at franchised dealers is typically more expensive than servicing at independent garages, averaging £199 and £116 respectively, without any apparent difference in the quality of the service offered.
When getting a car serviced consumers are advised to shop around and only use reputable garages that will carry out servicing work in line with the car manufacturer's service schedules. Car maintenance records must be completed and receipts for work should be retained in case problems with a warranty claim arise.