DAILY rental firms fear the result from the Competition Commission's report could be a dramatic fall in their already slim profit margins. Norman Donkin, director general of the British Vehicle Rental & Leasing Association, said concerns were raised because rental firms feared their discounts would be cut as manufacturers made up for having to provide larger discounts to dealers.

He added: 'Daily rental companies would then need to see alternative benefits, such as more attractive buy-back deals to protect them from residual values. Despite what experts are saying, there is a definite connection between new car prices and used car prices and if list prices come down, then used values will fall. Overall, we buy 800,000 vehicles a year and we should continue to have favourable terms because we buy in bulk.'