When Spencer Smart bought a brand new Fiat 500 convertible last year he was so pleased that shortly afterwards he told a friend it was the best car he had ever owned. But just a few months later, every time he drove above 40mph, the car’s steering wheel would start to vibrate badly. Soon the whole car was shaking so much when driven at speed that Smart, from Marazion, Cornwall, felt it was “no longer drivable”.

He asked an independent automotive engineer to examine the car which, by now, had 9,000 miles on the clock and was around nine months old.

Its condition, he argued, was neither “reasonable or acceptable” for its age, and said that he believed the problem was an inherent design issue that could not be fixed.

Fiat sent an engineer and compared it with other used 500 convertibles. It declared that the vibrations are a “characteristic” of the model. On that basis, it has refused to release him from his finance agreement.

Smart says he has test driven other Fiat 500 convertibles – there are 15,000 on Britain’s roads – and while those with low mileage don’t vibrate, it’s at higher mileages the problem emerges.

The freelance marketing consultant says it “can be felt through the structure of the car including the seats, door panels, etc, although my main reference point is obviously the steering”.

It has also left him wondering whether consumer rights legislation in the UK is fit for purpose. The case shows how difficult it can be for a consumer to get a large manufacturer to deal with you fairly if you think a vehicle has a significant design fault.

This is, however, not the first time Fiat has dismissed a problem with its retro-looking 500. In November 2014 BBC Watchdog revealed that models with the 1.2 litre petrol engine didn’t have sufficient power to get up steep hills. Top Gear’s former Stig was shown unable to get one up a hill in Bristol.

Fiat initially denied there was a problem, but after the programme it said it would update the software on each one.

Smart bought the car in October 2014 on a finance agreement with Fiat. He paid £5,700 deposit followed by £149 a month for four years.

Six months later, at 6,000 miles, he first noticed the problem. Thinking it was an issue with the wheels he had them repeatedly checked, but the problem only got worse.

“I have driven four 500C convertibles of different ages and mileage at the dealer. The newest, with fewer than 600 miles on the clock, drove perfectly. Two cars with roughly 8,000 miles vibrated much the same as mine. A fourth, older 500C with 26,000 miles, was considerably worse. The Fiat engineer was present when I tried that car and mentioned it before I did.

“It’s such a shame as the car is great in every respect, and if you just drove around town – below 40mph – it wouldn’t be a problem,” he says.

Desperate to get a reasonable outcome he offered to accept a like-for-like replacement of a same price 500 hard top, but Fiat would only offer a new lease deal on a cheaper model which, he says, would have left him several thousand pounds worse off.

“I’ve spent days dealing with this, as in garage visits, engineer visits, etc – and countless hours on phone calls, emails and general grumbling.

“It wouldn’t be acceptable if a customer bought a new TV that became unwatchable over time because of a design fault. So why should car manufacturers, selling £16,000 products, treat their customers any differently?” he asks.

Fiat declined to respond in regard to the allegations of a manufacturing design fault. It should be noted that few other drivers of this model have complained, publicly, at least.

However, after Guardian Money raised Smart’s case, Fiat has agreed to replace his car with a hardtop Fiat Abarth, on the same terms, which is all he wanted in the first place. “We recognise that Mr Smart is a loyal Fiat customer and are pleased that this issue has been resolved to his satisfaction,” says a spokeswoman.

Meanwhile, Smart says he thinks many other drivers are affected. “Until more come forward, Fiat won’t address the issue properly. It shouldn’t take the Guardian’s involvement to get a large company like Fiat to treat its customers fairly, but I guess that’s the world we live in,” he says.