The AA has been fined £4.2 million and ordered to refund more than 80,000 learner drivers after failing to display the full price of driving lessons upfront, a practice known as 'drip pricing'. The Competition and Markets Authority (CMA) found that the AA-owned driving schools, including BSM, introduced a mandatory booking fee later in the online booking process, breaching consumer law.
The CMA said the AA must repay over £760,000 to affected customers, with average payouts expected to be around £9 per person. Sarah Cardell, the CMA's chief executive, stated: 'If a fee is mandatory, the law is clear: it must be included in the price from the very start – not added at checkout – so consumers always know what they need to pay.'
The AA admitted to breaking the law and cooperated with the investigation, which reduced its potential penalty by 40%. This marks the first financial penalty imposed by the CMA under new powers that allow it to act without court proceedings.
An AA spokesperson said: 'Although the £3 booking fee was made clear to customers prior to their purchase, we acknowledge it should have also been displayed at the start of the online booking journey. Having listened to the regulator, we made immediate changes to our website to make the £3 booking fee more prominent. We are now refunding all relevant customers.'
The CMA continues to investigate other companies, including StubHub, Viagogo, Gold's Gym, Wayfair, Appliances Direct, and Marks Electrical, over similar pricing practices. A 2023 government report found that nearly half of online businesses use hidden fees, costing consumers an estimated £3.5 billion extra annually.
