10:33 am, October 28, 2022
Land Rover dealers are making customers promise not to sell their cars for at least six months in an effort to stop speculators.
Land Rover dealers have told Car Dealer anonymously that they are being forced to conduct ‘due diligence’ on prospective buyers to ensure they are not going to flip their cars for a profit.
The manufacturer is said to be even handing out heavy FINES to car dealers that fail to conduct the necessary checks on buyers.
One Land Rover dealer said it had heard of some independent dealers being on a ‘black list’ that official franchised sites were not allowed to sell Range Rovers too.
The news comes as Auto Express, the national weekly car magazine, reports that Land Rover customers are being asked to surrender their rights to sell their cars outside the dealer network for six months.
The magazine said that it had been made aware of two cases where customers ordered new Defenders and were asked to sign documents before they took delivery.
‘The document stipulates that the customer cannot sell their car to anyone other than an official Land Rover dealer within the first six months of ownership,’ reported the magazine.
One franchised Land Rover dealer Car Dealer spoke to confirmed that this practice was true and that the manufacturer was concerned about customers flipping their cars for huge profits.
‘Some customers have bought cars and then sold them on for big money and the manufacturer has not been particularly happy about that,’ said the dealer, who wished to remain anonymous.
‘We have to conduct due diligence on all buyers and if we don’t we face large fines.
‘Some customers have been going round lots of different dealers and placing multiple orders and I know the manufacturer has cancelled those.
‘Some independent dealers are even on a black list and we can’t sell to them.’
Land Rover waiting times for new cars can be as long as two years and that has pushed the price of used models far higher than new cars.
The firm has struggled with a supply of semi conductor and a bulging order book for its popular new models.
‘Many buyers are happy to jump the queue and pay a premium to get a car now,’ added the Land Rover dealer.
‘The manufacturer does seem happy to sell us used models itself for inflated prices though…’
Used car pricing experts CAP HPI said according to its data, Defenders are currently commanding premiums £10k over list or 114 per cent of their cost new.
Range Rover petrol models are going for 108 per cent of their cost new – a premium also of around £10k.
Absurd
In May, independent luxury car dealer Tom Hartley told Car Dealer Magazine that new Range Rover models were commanding £30k premiums.
He says that premium has now dropped – but they can still be sold over list price.
He told Car Dealer: ‘This is absurd, ludicrous and downright ridiculous.
‘How can a car manufacturer tell a customer what they can or cannot do with their own car? It’s their civil right to be able to do what they want with it.
‘I know of no evidence of any customer ever being sued by a car manufacturer – written agreement or not – for selling their car on.
‘Range Rover premiums have come down to about £10k over list now, and these things are a moment in time, but I think it is shocking car manufacturers act the way they do telling customers what they can do with their own property.’
Hartley said he had been banned from buying Land Rover models at main dealers for ‘40 years’ but that hasn’t stopped him getting hold of new models.
‘I went to a Land Rover dealer this year to buy a new Range Rover for my wife and the salesman told me he could not sell me a car,’ said Hartley.
‘And this was a car for me not to resell. My wife actually drives a new Range Rover now which I bought elsewhere.’
Hartley said he thought it was ‘terrible’ that car manufacturers make customers sign these sorts of agreements.
‘I’ve been waiting for this story to come out for years because I am furious that brands can also make customers buy undesirable models if they want to get into desirable ones,’ he added.
‘The way some car manufacturers – especially the luxury ones – treat their customers is shocking and it shouldn’t be allowed.’
A spokesperson for Land Rover UK said: ‘Together with our retailer partners we work to deliver a luxury experience for our clients.
‘To deliver this experience demands an exemplary level of customer care and attention from our retail teams and we take this type of feedback very seriously.
‘As you would expect in our business, our retail partners work hard to ensure all customers are treated fairly and with honestly, we therefore ask them to exercise due diligence to be sure they are transacting with buyers who intend to use the car and not with resellers.
‘It is not on our instruction or guidance that any agreements are made with customers relating to the onward sale of their vehicle, nor do we endorse it.’
