Upheld: unsatisfactory quality of goods supplied under hire purchase agreement complaint against BMW Financial Services(GB) Limited trading as ALPHERA Financial Services

Decision detail

Summary

Mrs A purchased a four-year-old used car with 65,688 miles under a hire purchase agreement with ALPHERA Financial Services in November 2024 for £18,999.00. Within six months of taking delivery, the vehicle developed multiple serious faults including engine noise, illuminated engine management light, timing chain issues, DPF sensor failure, and excessive oil consumption. By May 2025, a manufacturer-linked repairer diagnosed that the engine and turbo required replacement due to failed compression. The ombudsman upheld Mrs A's complaint that the vehicle was not of satisfactory quality, finding that a reasonable consumer could expect these critical components to last longer than six months and 7,534 miles. As repair costs exceeded the vehicle's value, the ombudsman ordered rejection of the vehicle with refund of the advance payment, reimbursement of diagnostic costs and post-May 2025 payments, plus £300 compensation for distress and inconvenience.

The Ombudsman's reasoning

The ombudsman applied the Consumer Rights Act 2015, which implies that goods supplied must be of satisfactory quality, fit for purpose, and as described, with durability being an aspect of satisfactory quality. While the vehicle was used and four years old at supply, a reasonable consumer could reasonably expect the engine and turbo to last longer than approximately six months and 7,534 miles of use. The combination of timing chain issues, DPF sensor failure, excessive oil consumption, and ultimately engine and turbo failure demonstrates the vehicle was not of satisfactory quality at the point of supply. The cost of repairs exceeding the vehicle's value makes rejection the fair remedy.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website