Ford price cuts save car buyers just £5

Price reductions announced by Ford will mean as little as £5 off the cost of a car, it was claimed yesterday. The company trumpeted cuts on the recommended "on-the-road" price of up to £2,000, but the savings by motorists will be considerably less.

Price reductions announced by Ford will mean as little as £5 off the cost of a car, it was claimed yesterday. The company trumpeted cuts on the recommended "on-the-road" price of up to £2,000, but the savings by motorists will be considerably less.

The price of Britain's best-selling vehicle, the Ford Focus five-door 1.6 Zetec, will be £1,505 less than the previous £13,500. But Steve Fowler, editor of What Car? magazine said that before the reduction was announced yesterday, the company was offering a "cashback" deal giving purchasers a cheque for £1,500 when they bought the vehicle. So the net saving is £5. Ford insisted their announcement constituted an "outstanding package of new benefits" which offered "clarity and stability" to customers.

A spokeswoman said they were also offering a three-year warranty instead of a one-year guarantee which would be worth £410. The warranty would be backdated to 1 September. Ian McAllister, Ford's managing director said the new measures would build on previous offers such as cashback. He said: "We believe this package of innovative, customer-focused initiatives means Ford customers can benefit from transparency of pricing, buy with confidence and enjoy unprecedented ease of purchase."

And an online service is to be launched, enabling customers to buy Ford cars on the internet.

A spokeswoman for the Consumers' Association said: "Ford has clearly not offered the biggest, best reduction in the world, but it will make the cost of cars clearer. The cashback system and other deals were just plain confusing. We're hoping it will trigger off a real price war." The association is offering the Focus at £10,425 with a one-year warranty as part of its own internet service, compared with Ford's new price of £11,995. Mr Fowler said potential buyers should still haggle to reduce Ford's prices.

Pressure has been building on carmakers to cut prices following a Competition Commission report in the summer that said cars were overpriced by 10 per cent here. Consumer groups have been pressing for cuts of up to 30 per cent.

Japanese car group Honda cut its prices by an average of 9 per cent last month and Ford's announcement yesterday will put pressure on its main rivals to offer price cuts.

Stephen Byers, Trade and Industry Secretary, welcomed the move by Ford as a "victory for the consumer".

Measures announced by the Government last month requiring car firms to offer the same discount to dealers as to fleet buyers, will ensure greater competition in the new car market, said the minister. "This announcement is a reflection of that. We can now look forward to the high-volume car manufacturers following suit."

Ford's main rival Vauxhall said it believed its models remained "excellent" value for money. But a spokesman added: "We always maintain a close watch on our competitors and we will certainly be looking at the details."