I think the car was too cheap for him to expect a refund, though a
contribution to the cost may be in order. In law your friend is obliged to take the matter up with the trader first and offer him the opportunity to fix the gearbox or refund then purchase price. Though it is not reasonable to expect a car bought for less than a tenth of its new price to be perfect. Law here: www.honestjohn.co.uk/faq/consumer-rights