Europe: Spain’s cash for clunkers program gets one last renewal image

In recent months the new car sales in Spain have been a true beacon of hope for the battered European auto market, with double-digit increases coming on a monthly basis thanks to the government’s scrappage project that was renewed time and time again.

With European sales down for six consecutive years to a two-decade low after the 2008-2009 crisis, Spain’s officials tried and succeeded in reviving dwindling demand at home, putting into effect an incentive program that would see older cars scrapped in exchange for subsidies from the state and automakers if a fuel-efficient new car was bought instead. Last month the program ceased and its effects were immediate – new car sales increased, by only by a low, single-digit percentage range. Now the government has announced it has decided to extend the cash for clunkers project one last time. The seven previous extensions succeeded in fueling the sales for no less than 20 months. The Spanish officials announced the government has gathered 225 million euros for the final round of incentives – the discount would be of up to 2,250 euros when they scrap the old vehicle to buy a new car.

The top 2,250 euro discount is given for the purchase of a seven-seat vehicle and is aimed at assisting families that have at least three children – the new program has cut 750 euros from the previous incentive packages, while other models would gain an incentive of 1,500 euros, down 1,000 from the previous package. The funding still comes midway between the carmakers and the government.

Via Automotive News Europe