The massive improvement in losses was skewed by the closure of car assembly at the Dagenham plant and other restructuring action taken in 2000.
Turnover for the year rose from £5,694 million to £6,737 million, with a volume increase of 8% to 404,344 new cars. Total new car market share was down from 16.8% to 16.4%.
Roger Putnam, chairman of Ford of Britain, said: 'Our financial performance in 2001 was an improvement for Ford compared with the previous year and we are on track to achieve our objective of returning to profitability in the UK at the earliest opportunity.
'The UK is a very important market to Ford, being second only to the United States in terms of the number of vehicles sold.
'It is therefore important for our global business success that we are profitable in the UK.'
Putnam is confident the return to profitability will be led by new product such as the Fiesta, Fusion and Transit Connect and a step up in product research and development.
The 'back to basics' mantra is the main reason for the sell–off of Kwik-Fit to European venture capital firm CVC Capital Partners for £330 million.