The news of reduced new-vehicle orders from car rental companies seems distressing. But the cutback also could help the Detroit 3 further reduce their dependence on those fleet sales.
Traditionally, rental companies purchased 15 percent of new vehicles built by the Detroit 3. In an attempt to bolster residual values, General Motors, Ford and Chrysler in recent years have scaled back their programs for selling vehicles to the daily rental fleets and especially repurchasing them to market as used cars.
In these tough times, some automakers are doubling their usual incentives to encourage rental companies to buy vehicles. That's understandable. But to rebuild their business models properly, the Detroit 3 must learn to rely entirely on retail sales. Although painful, this could be the ideal time to make that adjustment.