'Fleet drivers of staple cars like Fords, Vauxhalls and Peugeots could be in for a bit of a shock. Indications are that these manufacturers, together with others that have traditionally used fleet as a way to boost annual registration figures, are considering a new strategy – one that involves a new emphasis on retail business. At most risk are the short-term rental companies.

Manufacturers are starting to realise that these deals are draining their profits. Ford, for instance, took a decision not to push its volumes through the 400,000 mark last year, opting instead for simply maintaining its market leadership, albeit with a smaller margin. While the headlines centred on Ford losing sales, and losing its No1 position in fleet, UK managing director Paul Thomas took a different view: “Yes, we could've sold 400,000 if we'd wanted to, but it was our choice not to push this because we want to build in the right segments – market share is important, but so are profits and so are residual values.”

Ford has been through a lot of pain, culminating in a number of plant closures or product realignment, including in the UK. It now has much better utilisation, which reduces the pressure to flood the market with cheap cars, or to pre-register via its dealer network. Appropriately, it expects to cut losses in Europe this year from £1.1bn to around £100m.

Likewise, Peugeot is urging its dealers to shift focus away from fleet business towards retail – which partly explained the dip in its sales last year – and Citroen has also been quietly reducing its fleet exposure after building up UK market share. And it's not just the volume suppliers: Mercedes-Benz had its fingers burnt on the A-class when it struck a European-wide solus deal to supply the supermini to EasyRentaCar. Volumes totalled around 4,000 cars a year, but Mercedes was hit by huge damage recharges, and below par residuals and it has since downsized its supply.

It's leaving a gap for new rental and fleet suppliers, and one that the Far East carmakers seem eager to fill. Hyundai, Kia and GM Daewoo have each expressed a desire to pick up more business from fleets. Hyundai is targeting 3,300 fleet and rental sales this year, while Kia says that rising residual values will help it attract fleet business. Its current mix is 90% retail, but managing director Paul Williams says the carmaker is “getting more noticed with corporate guys – once we get on the curve, growth can be exponential”.

Any reshuffle, even if it's only by a small margin, will see the larger carmakers rebalancing their volumes towards more profitable business. And that's good news for future model development, as more money can be poured into exciting new projects.'