Five million Australian motorists believe this car warranty myth – you shouldn’t

It wasn’t so long ago that it was commonplace for consumers to be  told they had to take their cars back to the dealer for servicing or their warranties would be out the window.

It was no coincidence that this service-after-the-sale business model – which also applied to repairs and mandated the use of “genuine parts” – generated a major revenue stream for manufacturers and their dealer networks. Generally speaking, having your car serviced or repaired at a dealership meant paying more. 

CHOICE has previously reported on car servicing logbooks that sternly warned customers that only the dealer could work on their cars, and cases where people were given this directive by salespeople.

But the Australian Competition and Consumer Commission (ACCC) has since made it clear the industry’s position on this was never supportable under consumer law. 

The simple truth is that you can take your car to any qualified repairer and they can use the parts of their choosing as long as they’re fit for purpose. It helps to know that so-called “aftermarket” parts are often identical or equivalent to the “approved genuine” parts the dealer uses.

Despite what you may have heard, your warranty will remain intact under Australian Consumer Law if you never go back to the dealer again. 

But many motorists appear not to know this. In a 2026 national survey commissioned by the Australian Automotive Aftermarket Association (AAAA) – which has long pushed for the right for motorists to choose their repairers  – 44% of respondents said they believed they had to take their vehicles back to the dealer to keep their warranties intact.

The AAAA research suggests around five million car owners are still deceived by this myth. 

Manufacturers required to share technologies

While car owners are legally allowed to take their car to any repairer, this isn’t always easy in practice. A big factor at play is that cars are becoming more complicated than ever, and the number of proprietary technologies – including such things as driver data tracking – are increasing at breakneck speed.

Manufacturers don’t always share these technologies with independent repairers, forcing car owners back to the dealer. And even if the information is available, there’s so much of it across all the makes and models that independent repairers often have to turn to intermediary car data aggregators to keep up.

The hoarding of auto repair and servicing information by car companies was all supposed to have come to a stop in July 2022, when Australia’s Motor Vehicle Service and Repair Information Sharing Scheme (MVIS) came into effect.

It requires car manufacturers and their aligned dealers to share things like technical data, software updates and diagnostic codes (for cars manufactured after 2002) with independent repairers. The ACCC enforces the scheme.

But adherence to the MVIS remains a work in progress. The scheme was recently reviewed by the federal government, and a report tabled earlier this year called for renewing and strengthening the legislation.

Key recommendations include giving independent repairers reliable access to electronic service logbooks and making data accessible to data aggregators across the global industry. 

Small businesses subject to unfair trading 

These are also key issues for the Motor Trades Association of Australia (MTAA), which represents around 15,000 car repair businesses around Australia, the majority of them small, independent shops.

In a submission to the federal government’s consultation on unfair trading practices in the small business sector, the MTAA called for the forthcoming ban on unfair trading to be extended to independent car repair shops, which remain at the mercy of the global manufacturers and their dealer networks, despite the MVIS. Carmakers continue to tightly control access to parts and technologies.

Unfair trading by businesses as it affects individual customers – which has been a major focus for CHOICE in recent years – will become illegal under the Australian Consumer Law in July 2027.

The new protections, which passed through Parliament in July this year, are the culmination of years of campaigning by CHOICE, which has long held that the dirty tricks so many businesses have gotten up to in recent years should be outlawed.

Our focus has mainly been on tactics such as making it impossible to unsubscribe from a service or contact a business or designing websites that manipulate you into paying more. But unfair practices also affect certain small businesses in a way that directly impacts their customers. Car repairs are a major case in point.

Manufacturers exerting their power

In a survey that informed the MTAA submission, independent repairers described how dealers and manufacturers apply leverage to cut their costs and, in the long run, increase the costs for customers. 

One standard tactic by manufacturers is to arbitrarily reduce the billable hours they’re willing to pay independent repairers for a part to be replaced under warranty, claiming that it can be done much quicker in dealer repair shops.

Manufacturers may only pay the shop two-and-a-half hours of labour to replace a gearbox, for instance, even though it can take qualified repairers up to four-and-a-half hours.

“The technicians have been trained in accordance with what the manufacturer prescribes. They can’t do it any faster than that,” one repair shop manager reports.

The MTAA has also documented cases in which manufacturers have blocked independent repairer access to genuine replacement parts unless they’re part of a manufacturer-approved repairer network.

One example is Tesla, which reportedly limits access to body repair parts to its Approved Body Shop Network. According to the MTAA, there were only ten such shops in metropolitan Melbourne at the time it lodged its submission, and only one in regional Victoria.

Independent repairers also report being pressured by car insurance companies to cut corners to reduce repair costs.

Such tactics have a negative downstream effect on customers, who either end up paying more or can’t get their car fixed properly or at a repairer of their choice.

The inference is still there

Asked whether car owners are still being told by dealerships that they must bring their vehicles back for servicing and repairs, MTAA CEO Bruce Billson says they are often led to believe so in subtle ways. 

“The overt insistence has certainly declined, but we’re still getting a lot of feedback that an implied expectation is being conjured up in the consumer’s mind that their best interests are served by maintaining that umbilical cord with the dealer,” Billson says.

“It means consumers may have to pay more, wait longer, travel further, and have fewer choices, particularly in regional and outer metropolitan areas.”

The ACCC is tasked with enforcing the MVIS, but Billson says its approach has generally been to react to reports of violations rather than look for them.

“The passive enforcement posture is not particularly helpful. A more proactive positioning by consumer regulators is what’s needed.”

Some recent wins

Stronger regulation has started to be applied in recent months. In August this year, the ACCC launched court action against Subaru Australia for allegedly failing to provide software and other technical information to independent repairers.

It was the first court case the ACCC had launched for non-compliance with the MVIS.

A slew of cases followed. In September, the ACCC reported that Mazda, Kia, and BYD had agreed to improve access to service and repair information following separate ACCC investigations.

(Previously, in September 2024, Honda Australia paid a $18,780 penalty for putting conditions on independent repairer access to its software after the ACCC issued an infringement notice.)

“They’re not living up to their obligations under the MVIS, and that’s why it’s good to see the ACCC up and about,” Billson says.

‘Car companies do it sneakily’

AAAA CEO Stuart Charity says the AAAA has a “whole suite of tools” to educate customers about their rights as well as a legal service that will assist AAAA small business members in cases where a customer has had a warranty claim denied due to servicing by an independent repairer. But there’s no monitoring tool overseeing the entire car dealership industry.

The advent of driver data tracking – which Charity says is now the norm across the industry – gives car companies yet another advantage over independent repair shops.

They can communicate digitally with both the vehicle and the driver regarding repairs and updates without involving anyone outside the manufacturer/dealer circle.

“The myth that gets perpetuated by the car companies and the dealerships around servicing under warranty is certainly still out there, but it’s very hard to get definitive evidence of dealers misleading customers on this,” Charity says.

“The car companies do it sneakily, but they are still perpetuating that myth. There’s a whole lot of both overt and covert ways that the car companies convince car owners that they have to take their cars back to the dealers.”

When the evidence is there, the resolution is usually pretty straightforward.

“Most dealers back down when we ask them to put the refusal to pay a claim in writing, but we have referred a few cases to the ACCC.”

Charity says the MVIS, along with the recent ACCC actions, are helping redress the power imbalance, but the efforts by car companies and dealers to get motorists back to the dealership as often as possible – whatever form they may take – are clearly paying off.

The findings of the AAAA research would likely be welcomed in the boardrooms of car manufacturers.

“Australia’s got nearly 20 million vehicles on the road, and half of those are under warranty. Based on our recent consumer research, the owners of around half the cars still under warranty – or around five million car owners – still believe that they have to get their car serviced at the dealership,” Charity says.

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Andy Kollmorgen

Andy Kollmorgen is the Investigations Editor at CHOICE. He reports on a wide range of issues in the consumer marketplace, with a focus on financial harm to vulnerable people at the hands of corporations and businesses. Prior to CHOICE, Andy worked at the Australian Securities and Investments Commission (ASIC) and at the Australian Financial Review along with a number of other news organisations. Andy is a former member of the NSW Fair Trading Advisory Council. He has a Bachelor of Arts in English from New York University. LinkedIn

Andy Kollmorgen is the Investigations Editor at CHOICE. He reports on a wide range of issues in the consumer marketplace, with a focus on financial harm to vulnerable people at the hands of corporations and businesses. Prior to CHOICE, Andy worked at the Australian Securities and Investments Commission (ASIC) and at the Australian Financial Review along with a number of other news organisations. Andy is a former member of the NSW Fair Trading Advisory Council. He has a Bachelor of Arts in English from New York University. LinkedIn