Motorists should be free to choose their mechanic

The Office of Fair Trading wants car makers to lift restrictions on where new cars may be serviced, while under warranty.

If they fail to do so, it might launch a formal investigation under European competition law.

About half of all new cars sold have warranties with service restrictions.

Over 2.5m new cars are sold in the UK every year.

After-sales care

All new cars come with a manufacturer's warranty, which generally runs for one to three years.

In addition, many manufacturers also offer, at no additional charge, "dealer-based extended warranties" that take the total period of cover to three years.

Competition and consumer value in the after-sales market are inhibited John Vickers, OFT chairman

Under the terms of many of these extended warranties, and some manufacturers' warranties, the car must be serviced at a garage belonging to the manufacturers' franchised dealer network.

But servicing a car at a franchised dealer is typically £83 more expensive than at an independent garage, the OFT said.

There is also confusion among consumers over the options available to them, with more than two-thirds of motorists assuming their warranty would be invalidated if they used an independent garage, even when this was not the case.

John Vickers, OFT chairman, said: "Competition and consumer value in the after-sales market are inhibited by restrictions on car servicing choices of car owners.