As many as one in five new cars are being pre-registered by dealers in order to meet manufacturers' sales targets - a practice that could be skewing overall sales figures and confusing customers.
An investigation by BBC Radio 4’s You and Yours programme found that many dealers are increasingly buying and registering surplus stock cars under their business name, and then selling them on to customers at a discount of up to 20%.
Dealers told the BBC that the process – which is legal – is often the only way to hit sales targets set by manufacturers. Failure to hit the targets can affect bonus payments from the car maker, but the investigation found that pre-registering can create a dependency, as it makes it harder to sell new cars.
There are fears that while customers can benefit from cheaper prices, many do not understand the process and how it affects buyer protection, such as manufacturer warranty periods.
However, Tamzen Isacsson of the Society of Motor Manufacturers and Traders (SMMT) told the BBC that the process was driven by natural business demand and consumer choice, and was a normal part of a functioning car market.