Ford looks to reduce prices across range
‘The weakness of the pound has been a big problem for us forcing up our costs, but discounting prices doesn’t work in fleet markets because Benefit in Kind tax is based on CO2 and the list price,’ he said. About 65% of Galaxy sales and half of S-Max sales are to business customers.
So, in the interests of transparency, the transaction price – the price most customers pay after haggling – will become the sticker price, or “Blue Tag” price as Ford is calling it.
Ford has achieved this by reducing dealer margins and showroom discounts; savings are between £2,500 and £3,000.
‘We’ve already reduced prices on Mondeo and we’re looking at the rest of the range,’ said Simpson.
‘But we have a lot of stakeholders including dealers, lease companies and ourselves. The system looks like it’s working but we will study it before rolling it out to other models.’
Simpson assured would-be buyers of new Fords that they would not be at a disadvantage from future reductions in list prices affecting residual value.
‘If you buy a Fiesta or Focus today, the discounted price you pay will be the eventual “Blue Tag” price.
‘It won’t be cheaper, but the discount will be formalised and, if anything, residual values will improve,’ he told reporters at the launch of the S-Max and Galaxy.