The continuing devaluation of the British pound against the Euro (more than 30 per cent since 2007) is to blame for Ford's decision to increase prices by an average of 2.7 per cent across most of its UK range from all orders received after November 30, 2009.

The automaker said that while smaller capacity engines and the Transit LCV are assembled in Britain, other vehicles and component parts are imported from the Euro zone, which translates into a significant cost penalty because of the drop in the value of the pound.

"To combat the continuing weakness of the £ against the Euro, Ford has reduced costs across its entire UK business, including personnel reductions in its central operation and across its dealer network", said Nigel Sharp, Ford of Britain managing director. "However, price increases are still required to maintain a viable business and to recover relative cost increases caused by the weakness of the £ over an extended period."

Ford said that prices will increase by £250-£500 on most popular passenger models such as the Ka, Fiesta, Focus, C-MAX, Kuga and Mondeo, rising to £600 on the Ford S-MAX and Galaxy.

For commercial vehicles, the Fiesta Van's price will increase by £400, the Transit Connect and Ranger by £500 and the Transit 1T model by £600.

Prices for the Ford Focus RS and the Transit 2T will remain the same.