Customer Complaints In Car Dealerships: What To Do, What To Say, And How To Avoid Repeat Issues

If you work in a car dealership, you already know this truth. Most complaints are not about the car.

They’re about how the customer felt that they were treated once something went wrong with the car. A complaint can be annoying. It can also be useful. Handled well, it can save a sale, protect your reviews, and stop the issue from becoming a bigger problem.

And in the UK motor trade, complaints are not rare.

The Motor Ombudsman reported 18,570 used car complaints in 2025, a 14% rise on the year before, according to industry reporting.

In its own insight report, the Motor Ombudsman also says that used car purchases account for around 40% of the consumer disputes it sees each year.

So yes, this matters.

This blog is written by Marsh Finance, a UK car finance lender, for people working in dealerships. It focuses on what you can control: process, language, and decisions.

What Customers Usually Complain About In The Motor Trade

Most complaints land in familiar buckets:

• The car was not as described
• A fault happened soon after handover
• Repair delays or poor communication
• “I feel fobbed off”
• Refund or rejection disputes
• Finance misunderstandings (APR, payments, add-ons, documentation)

Customers rarely open with “your process was poor.”
They open with “you’ve treated me unfairly.”

So, your first job is not to argue the facts. Your first job is to de-escalate.

The Real Goal Of Complaint Handling

A good complaint process does three things:

• Fixes the customer problem (or explains clearly why you can’t)
• Protects the business (records, evidence, and compliance)
• Stops the same issue from happening again

If you only do number 1, you will keep getting the same complaint.

The Complaint Handling Mindset That Works

Here’s the mindset shift that changes everything:

You are not trying to “win” the complaint. You are trying to close the complaint.

“Winning” often creates:

• Bad reviews
• Social posts
• Escalations to ADR or ombudsman
• Wasted staff time

Closing the complaint usually means:

• Fast acknowledgement
• Calm language
• A clear plan
• Fair options
• And proper notes

A Simple Dealership Complaint Process You Can Actually Follow

Use this as your internal flow.

Step 1: Acknowledge Quickly And Take Control

Even if you cannot solve it today, you can still respond today.

A simple acknowledgement script:

• “Thanks for letting us know. I’m sorry this has been frustrating.”
• “I’m going to look into it and come back to you by [day/time].”
• “Can I confirm the best number and email to reach you?”

If you do nothing else, do this. It lowers heat.

Step 2: Get The Facts Without Starting A Fight

Ask for the basics and keep it clean:

• What is the issue?
• When did it start?
• What outcome do they want?
• What evidence do they have (photos, invoice, messages, advert)?

Do not accuse. Do not assume.

Step 3: Decide If It Is Sales, Service, Or Finance

This is where dealerships waste time.

Route it fast:

• Vehicle sale / “not as described” goes to sales manager
• Fault / repair goes to service or prep lead
• Finance complaint goes to the person responsible for regulated complaint handling

Finance complaints must be handled properly because they can be escalated.

The Financial Ombudsman Service explains that firms generally have up to 8 weeks to resolve most complaints before the customer can go to them.

(If your dealership is an intermediary, appointed representative, or has a complaints process under FCA expectations, this still matters. Your compliance lead should be across it.)

Step 4: Offer Clear Options In Plain English

Customers hate “policy language”.

Use simple options like:

• Repair by [date]
• Contribution to repair costs
• Inspection with independent report
• Exchange (where appropriate)
• Rejection process steps (where applicable)

If it is a used car fault dispute, customers often reference consumer rights. Citizens Advice outlines that a buyer may have rights to a repair, cost of repair, or refund depending on the situation.

You do not need to quote the law at the customer. But you do need to show you understand the basics and you’re taking it seriously.

Step 5: Put It In Writing

Send a short email after the call:

• What they said
• What you’re doing next
• When you’ll update them

This protects you and reduces misunderstandings.

Step 6: Close It Properly

When it’s resolved, confirm:

• What was done
• When it was done
• Any warranty terms
• Who to contact if the issue returns

This is how you stop “round two”.

The Words That Escalate Complaints Fast

Avoid these phrases:

• “That’s not our problem.”
• “You signed the paperwork.”
• “It’s sold as seen.”
• “It’s wear and tear” (said too early, without inspection)
• “That’s policy” (without explaining the reason)

These phrases may feel satisfying for five seconds. They cost you hours later.

Better Phrases That Calm People Down

Use these instead:

• “I can see why you’re unhappy.”
• “Let’s work through this step by step.”
• “I’m going to take ownership of this from here.”
• “Here’s what we can do next.”
• “I’ll update you by [time]. If I can’t, I’ll still message you.”

Simple. Human. Clear.

When To Escalate Internally

Escalate immediately if any of these show up:

• Threat of social media or press
• Mention of solicitor
• Mention of ombudsman or Trading Standards
• Vulnerability indicators (health issues, financial distress)
• Repeat contact with rising anger
• Dispute about finance disclosure or price

You’re not escalating because the customer is “difficult”. You’re escalating because the risk is higher.

When Customers Go To The Motor Ombudsman

The Motor Ombudsman is an ADR body for the motor industry.

They publish guidance on their dispute resolution process and timeframes.
They also note time limits for bringing a complaint to them, such as contacting them within a set timeframe after the business’s final response.

Practical dealership point: If your business is accredited and a customer is heading that way, your best move is to:

• Ensure your file is complete
• Show you tried reasonable steps
• Keep communication polite and written

ADR decisions lean heavily on what you can evidence.

Finance Complaints Need Extra Care

Dealership staff often get caught out here.

A customer might complain about:

• Not understanding APR
• Not understanding optionality of add-ons
• Affordability concerns
• Feeling pressured
• Commission-related concerns (in the wider market)

Even if the original complaint is emotional, your response must be:

• Clear
• Calm
• Documented

The FCA’s DISP rules cover complaint handling expectations for regulated firms, and the Financial Ombudsman sets out the typical 8-week window before escalation.

If you’re unsure where responsibility sits (dealer, broker, lender), don’t guess in writing. Route it to your complaints lead and keep the customer informed.

The Simple Complaint File Checklist

If you want fewer messy escalations, keep this file every time:

• Customer details and best contact method
• Timeline of events
• Copy of advert and invoice
• Handover checklist and notes
• Photos or videos (if relevant)
• Inspection reports (internal and independent)
• All emails and call notes
• What remedy was offered and why

A complaint without a file becomes “your word vs theirs”.

That is where businesses lose time and sleep.

How To Reduce Complaints Before They Start

These are boring, but they work.

• Set expectations clearly at handover
• Put promises in writing
• Call customers after 48 hours (many complaints start in silence)
• Use a simple “next steps” card for faults and repairs
• Train staff on how to explain finance in plain English

The best complaint is the one that never appears on Google reviews.

FAQs Dealership Teams Actually Ask

How Fast Should We Respond To A Customer Complaint?

Same day if possible. Even a short acknowledgement helps you control the situation.

Should We Offer A Refund Straight Away?

Not automatically. Gather facts first and offer a fair remedy based on the issue and evidence.

What If The Customer Is Aggressive Or Abusive?

Stay calm, set boundaries, and move the conversation to writing. Escalate internally.

Can A Customer Go Straight To The Motor Ombudsman?

They usually need to raise the issue with the business first. The Motor Ombudsman provides guidance on its dispute process and timeframes.

How Long Do We Have To Resolve A Finance-Related Complaint?

For most complaints that can be escalated to the Financial Ombudsman Service, firms generally have up to 8 weeks to issue a final response.