CONTRACT hire firm Fleetlease has launched a new direct sales operation to stem losses of up to £400 on every car it sells caused by the collapse in residual values. Fleetlease Direct will offer ex-lease vehicles for sale direct to the public from a new showroom in Newbury, which began trading last month and has already sold 185 cars.

The launch of the division came as Fleetlease's parent, Hitachi Credit (UK) revealed it was setting aside £5 million to cover losses on the leasing firm's 14,000-vehicle contract hire fleet. Martyn Gallop, Fleetlease operations director, said: 'Over the last three years we have disposed of nearly 13,000 vehicles via traditional channels, but we felt we needed to adopt a more direct approach in offering our best cars for public sale.'

Hugh Lyall, Fleetlease Direct general manager, said the car hire and leasing industry was going through a difficult time and the company needed to broaden its scope by offering its best cars for public sale, hoping to improve used values. All vehicles in the fleet segment will have been owned by Fleetlease from new, will have done a maximum of 60,000 miles (or a minimum 35,000 miles) and will have full manufacturers' service history and an independent check by AA Business Services.