Spain to Extend Car Scrappage Subsidies Again

Spain plans to provide an additional €70 million to a vehicle scrappage scheme when the current allocation of €150 million runs out.

The extension would be the second for the program launched in October 2012. The latest installment will bring total funding for the program to €295 million.

The scrappage plan is credited with slowing the decline of the country's auto sales. In the January-June period of this year, Spain's car deliveries slid 5% year on year to 386,400 units compared with the 7% sales decline across Europe.

The country's scheme pays €2,000 to each owner who scraps a car or commercial vehicle that is at least 10 years old and replaces it with a new fuel-efficient model. The compensation rises to €3,000 if the new vehicle seats more than five people. The government pays half the subsidy and carmakers pay the balance.