Get around to Trading Standards first thing tomorrow and tell them what has happened, then go back to him and demand ALL your money back, under The Sales of Goods Act, on the grounds that "the goods were not of merchantable quality, and not as described"
If he refuses, write a letter, by recorded delivery, giving him 14 days to pay up, or you will take him to the Small Claims Court. DO NOT USE THE CAR IN THE MEANTIME.
As a dealer, is he with any large franchise? Is he a member of the Trade Assoc? Is he well known? f yes, get on to the local papers, radio, TV, etc, if he wont play ball.
Don't know where you are in the country, but it is useful putting that in your Profile.