Ford Expects New Car Sales to Explode with Spain Incentives

While Renault's bosses insisted that the Spanish government isn't helping automakers as it should, Ford expects new car sales to be increased by 400,000 units thanks to incentives offered by Spain and the United Kingdom. Both countries were severely affected by the economic recession, with new car registrations felling in the UK by 24 percent to 133,475 in April while the decline in Spain was 45.6 percent to 67,215, according to data sourced from Autonews.

"It's very good news from Spain," Ford of Europe's Ingvar Sviggum was quoted as saying by the aforementioned source. "It was the only one of the big five markets in Europe not to have a scheme and this is going to boost the industry for the rest of this year."

"The industry is down by 50 percent. It is dead. Spain has a very old car parc, so a scrappage scheme will have a great effect," he explained in a conference call. "The scheme is a little weaker than we hoped," Sviggum said referring to the United Kingdom subsidiaries, "but I think it will help the industry."

As said in the first paragraph, Renault earlier this week warned that it might close its Spanish plant in Valladolid unless the government provides financial support to build a new model and a new engine at the local facility.

"We are talking about a future-oriented competitiveness plan to help us through the crisis and to ensure that we don't close the factory," Jean-Pierre Laurent, head of Renault's Spanish operations, was quoted as saying by Autonews.

"We have to ensure that Valladolid is competitive with other Renault factories," Laurent said. "To get there, we are going to need assistance from the national government, as well as from the regional government of Castile and Leon."