Ford's American arm is well on with its 'Living Legends' programme - the Thunderbird is on the street and the GT41 is close behind.

Ford of Europe is also heading down the road with plans for a new medium-size coupe. Leaks are already referring to the car as 'Capri' but would Ford really exhume that old badge?

Whatever it's called, the new Ford coupe project - codenamed S307 - is at an early stage as the scheduled on-sale date isn't until the first quarter of 2006. Original plans called for two different sporting models. S272 was a Mondeo-based Cougar replacement and BE313, a so-called Urban Adventure Coupe based on the Fiesta. These have been replaced by an all-new vehicle on the next Focus/C1 components set.

S272 was an expensive upmarket proposition which had Volvo five and six-cylinder engines and the option of a high-tech four-wheel drive system fitted with active differentials and a six-speed sequential box. But the budget - and showroom prices - had gone overboard. One senior Ford designer alluded to the project a few months ago, saying: “I want the most design on offer for £25,000”.

Well, he didn't get it because at the 11th hour the cars were scrapped, as was the proposed Focus cabriolet. Instead, Ford created S307 - the new 'Capri' project which should kill three birds with one stone. S307 may end up with just one body style - an SLK-style folding hard roof, showing no maker can afford to ignore Peugeot's hugely successful 206cc flip-top, which will soon to be joined by a 307cc. Ford's interpretation will have either front or four-wheel drive and manual and automatic transmissions. The base model is likely to be powered by a 130bhp 2.0-litre four-pot. One rung up there will be a 173bhp ST.

The flagship model has been likened to a direct descendant of the legendary Capri 2600RS. For as little as £21,000 the RS version will get a turbocharged four-pot (good for between 225 and 250bhp), four-wheel-drive and a six-speed Getrag transmission as standard. S307's price range should sit between £12,000 and £21,000.

Vauxhall/Opel is also said to be on the verge of giving the green light to a similar model with a folding hard top.