Ford's British boss has defended the company's announcement of across-the-board price rises from 1 April by claiming that the firm is in a "battle of survival."
Nigel Sharp, Ford of Britain's Managing Director, claimed that the plummeting value of the pound against the euro has forced the move, telling Autocar that "the decline in the value of the pound has probably had as much impact on our business as the decline of the overall car industry."
Ford has been particularly hard hit by the relative strength of the euro, as almost all of the company's European assembly is carried out in the Euro-zone. The Euro has risen in value against the pound by 30 per cent in the last 18 months, effectively wiping out Ford's operating margin in the UK.
"Most of our costs are in Euros and our revenues are in pounds," said Sharp, "we still make engines in the UK and the labour costs for those engines are in pounds, but some of the material costs and the cost of ancilliary equipment are in euros too, or commodities in dollars. The net effect is a huge squeeze on margins, which have become non-existent."