1car1, which went into administration last week, is having its fleet of 15,000 vehicles returned to its financiers, meaning it will soon become unviable as a going concern.

PricewaterhouseCoopers was appointed as administrator at 1car1 - one of the country's largest independently owned car and van rental companies - on 18 March.

PWC's Steve Ellis and Mark Loftus were appointed as joint administrators.

They confirmed that hundreds of employees will lose their jobs immediately and hundreds more face a very uncertain future.

The company's collapse is blamed on the difficulties it faced trying to secure loans for its fleet renewal programme.

“1car1 has sadly become reliant on levels of funding which are unsustainable in the current credit climate," said Ellis.

"1car1 is a well known brand with an exclusive network and we remain hopeful that it will prove attractive to a purchaser.

"Potential buyers for a radically restructured business will need to act quickly as we are returning the fleet to funders at their request.

"Clearly, it is disappointing to have to make a significant number of redundancies.

"My team and I will be doing all we can to help these employees at this difficult time."

Operating from its base in Kirkstall, Leeds, 1car1 operates from 87 sites throughout England, Scotland and Wales.

It employs around 800 people, of which 108 are based at its head office in Kirkstall, Leeds.

1car1 has grown very rapidly over the last five years but since the onset of the downturn, the company said it has experienced a tightening in its available credit.

"This has meant that replenishment of the vehicle fleet has been difficult to fulfil," said PricewaterhouseCoopers.

PricewaterhouseCoopers said it is working on strategies to "salvage value from the business, however the main trading business and the company’s 15,000 vehicle fleet is likely to be wound down over the next five weeks".

200 staff will be made redundant immediately in order to reduce costs.

Prospective purchasers should contact Chris Rooney christopher.b.rooney@uk.pwc.com in the first instance.