Two leading driving schools have been directed to repay £760,000 to over 80,000 students. The AA Driving School and BSM Driving School, both under the ownership of AA, have also been fined £4.2 million by the Competition and Markets Authority (CMA) for employing drip pricing strategies.
Drip pricing involves promoting a product or service at a low initial cost and then adding unavoidable mandatory charges later during the booking process. The CMA discovered that both schools did not disclose the total price upfront for their online bookings, failing to include a mandatory £3 booking fee between April and December 2025.
New customers were only shown the full price at the checkout stage after selecting lessons, choosing times, and entering personal information. Returning customers saw the booking fee separately from the initial price, with it being included in the total price at the following checkout page.
The refund amount for each consumer will vary based on the number of lesson packages purchased, with an average payout of around £9. Impacted customers do not need to take any action to receive their refund, as the AA Driving School or BSM Driving School will contact each customer individually and issue automatic refunds.
The CMA initiated an investigation into AA Driving School and BSM Driving School the previous year. The AA admitted to violating consumer laws and reached an early settlement with the CMA, resulting in a 40% reduction to its financial penalty.
Sarah Cardell, Chief Executive of the CMA, emphasized the importance of transparent pricing, stating that mandatory fees must be included in the price from the beginning to provide clarity to consumers. The spokesperson for AA driving schools acknowledged the need for better disclosure of the £3 booking fee and highlighted the company’s commitment to consumer rights over its long history.
In a separate report in 2023, the Department for Business and Trade found that nearly half of online businesses use hidden or drip fees, leading consumers to spend billions extra annually. Service fees, like booking or processing charges, were flagged as problematic for being mandatory and revealed late in the checkout process.
