Sales of Family Cars in Spain Plummet

The crisis has pushed Spain's auto industry back to 1994's production levels. Asociación Española de Fabricantes de Automóviles y Camiones (Anfac) forecasts a continuous decrease in family car sales, which could go down from 1.16 million units last year to 900,000 units in 2009. Anfac figures show that after a 12.3 percent downfall in 2008, a further 13 percent drop is to be expected in the sector this year.

As the automotive industry enters its second year of downfall, Spanish based manufacturers are now trying to persuade the Government to take action and save the industry. Even if they do not expect last minute bailouts, the sector hopes that some measures, such as removing registration taxes or launching a new used car trade-in program could make all the difference.

A similar trade-in incentive is to take place in Germany and even if it is not yet final, the announcement alone made all the difference, as German dealerships reported an increase in interest from buyers over the weekend. The plan proposes that every new car buyer who scraps his old car will receive a 2,500 euro certificate. A similar program is desired by the Spanish producers and dealers.

If nothing is done, industry leaders are prepared for massive layoffs. Temporary production stoppages are already happening in Spain. Renault has an idle scheme for more than 10,000 of its workers, Ford hopes to send home over 4,500 people for at least 16 days, while Seat has approved a plan to temporarily dismiss in excess of 5,000 workers, in a time frame that could last up until June, just-auto.com reported.