Ford Thinks Increasing UK Prices Is a Good Strategy

Although Ford repeatedly said it doesn't need government money as it can get through the crisis by its own, the company admitted it experienced some of the toughest times in its history, as sales collapsed in almost every single market. However, the American automaker considered that the best way to cope with the recession is to increase model prices in falling markets such as the United Kingdom.

Obviously, Ford claims the continuous weakness of the pound versus the euro pushed it towards this kind of strategy but still, increasing prices during so difficult moment doesn't sound like the best idea.

Ford will increase the price of all its models sold in the UK from the start of April 2009 by an average of 3.75 percent, starting at an extra 50 pounds on a Ford Ka and rising to 1000 pounds on a Focus Coupe Cabriolet.

"We are reacting to the continued decline of the £ against the Euro", said Nigel Sharp, managing director Ford of Britain. "Raising prices in such difficult times may seem counter-intuitive, but as a UK business with so many of our costs priced in Euros, we have no choice if we are to protect jobs and remain viable.

"The Euro has strengthened 30 per cent in the past 18 months," he added "and 18 per cent in last 12 months alone. The weakness of the £ had a huge negative impact – well into nine figures – on Ford's UK business in 2008."

And Ford isn't the first companies that turn to price increases in the United Kingdom, as Mazda earlier this month announced a 2 percent price boost for Mazda5 and Mazda6 starting April.