Mercedes-Benz and Volkswagen are to challenge the £9.1bn Financial Conduct Authority (FCA) redress scheme.
Reuters reported the two carmakers are among four groups to oppose the redress scheme which was announced by the FCA.
The the financial services arm of VW has asked the courts to help clarify elements of the compensation plan hours after Mercedes-Benz confirmed it was also among those challenging the scheme.
In a statement issued to Motor Trader, Volkswagen Financial Services, said: “We support redress for customers who were genuinely disadvantaged, but it is also important that any scheme is lawful, fair and properly targeted.
“We have identified issues that require independent clarification and we have therefore asked the Upper Tribunal to provide clarity. Our referral is focused on ensuring the redress scheme is applied accurately and fairly.”
Mercedes-Benz also confirmed its challenge. “Mercedes‑Benz Group can confirm that it has appealed against the FCA’s proposed Redress Scheme. Given that this is subject to ongoing legal proceedings, we cannot comment further.”
The FCA said in a statement: “Our scheme is the quickest, fairest and most efficient way to compensate consumers.
“It is disappointing that some have decided to challenge it and delay consumers getting their money back, when for many the payouts would be very welcome this year as they face rising household bills.
“This also prolongs the uncertainty for all involved, which is not good for investment or a healthy motor finance market. We are considering our approach and will set out more later this week.”
The Finance & Leasing Association (FLA) has confirmed that banks and finance hoses will not be challenging the Financial Conduct Authority’s (FCA) motor finance redress scheme.
It said it continued to have concerns about the scheme but it wanted a practical solution which compensated consumers for mis-selling while giving motor finance houses the wider market clarity on the issue.
Consumer group Consumer Voice has is to challenge the FCA’s car finance compensation scheme.
It claims that for many consumers who took out motor finance the way compensation is calculated risks falls short of what they actually lost.
It said it was not challenging the idea of a compensation scheme but instead whether the FCA one is fair and delivers what consumers are actually owed.
Consumer Voice said the FCA had taken a narrow approach to calculating losses and set fixed assumptions that may not reflect real-world outcomes.
It has put the put the FCA on notice of its intention to apply to the Upper Tribunal to review the way the scheme has been designed, particularly how compensation is calculated.
Alex Neill, co-founder of Consumer Voice, said: “We support a redress scheme, but this one does not go far enough.
“Millions of drivers were overcharged through hidden and unfair commission, yet the FCA’s scheme risks leaving many of them missing out on hundreds of pounds they’re owed.”