Spanish government extends incentive programme to boost automobile sector

The Spanish government extended on Friday the Plan PIVE, an incentive program that aims at boosting the automobile sector in Spain, with a budget of 175 million euros (239 million U.S. dollars). Deputy Prime Minister Soraya Saenz de Santamaria told reporters at a press conference after the cabinet meeting that the 175 million euros would be enough to cover the whole 2014 helping to renew Spain's fleet with 175,000 new vehicles. Saenz de Santamaria also gave positive information about the effects of the previous editions of the Plan PIVE (1, 2, 3 and 4) in the industry: they helped to renew Spanish fleet with 365,000 new vehicles allowing the State to collect 1 billion euros of taxes. According to the government, new cars helped improve energy efficiency and road safety, a total of 127 million liters of fuel were saved and 161,000 tons of CO2 were not emitted. The incentive program also helped job creation in Spain, whose unemployment rate is very high, creating around 10,000 new jobs, Saenz de Santamaria said, predicting that the Plan PIVE 5 would create 4,500 more jobs. Saenz de Santamaria also said the Plan PIVE boosted foreign investment in Spain and pointed out it had grown threefold to 21.644 million euros up to September 2013. Organizations from the automotive industry were happy with the announcement as they had already encouraged the government to extend Plan PIVE in order to maintain sales. The president of the Association of Car Dealers, Ganvam, said that the Plan PIVE 5 will allow the sector to sell around 800,000 vehicles in 2014, which will mean an 11 percent increase when compared with 2013, when the sector sold a total of 722,703 units. The sector said that the Plan will avoid dissolution of companies. The automotive sector in Spain lost between 45,000 and 50,000 jobs since the crisis started while 3,500 small and medium size enterprises closed because of the economic situation. This was the fourth time Plan PIVE was extended, the first one had a budget of 75 million euros and the Plan PIVE 2, 3 and 4 had budgets of 150, 70 and 70 million euros respectively. This Plan gives prospective buyers 2,000 euros to buy a new and more ecological car, while Plan PIMA Aire (extended in Oct. 2013) aims to boost sales of motorcycles, moped, electric bicycles and vans. (1 euro = 1.37 U.S. dollars)