Spanish Prime Minister on Tuesday announced a subsidy of 2,000 Euros (2,700 dollars) for motorists wanting to buy a new car in a bid to ease recession tension.
We will propose a plan of direct aid for the purchase of a car, Prime Minister Jose Luis Rodriguez Zapatero told parliament during an annual state of the nation debate.
A similar measure has already been adopted by other European countries.
Zapatero referred to the current economic crisis as, “the worst financial and economical crisis that the international economy has suffered in the past fifty years.”
Five hundreds euros (680 dollars) of the subsidized amount will be provided by the central government, another 500 euros will come from Spain's regional governments while the remaining 1,000 euros would be provided by car manufacturers, he said.
During the first four months of the year, new car registrations in Spain plummeted by 43.7 percent to 471,299 compared to the same period in 2008.
In 2008, new car sales plunged 28 percent, the largest-ever annual decline as the country slumped into its first recession in 15 years.
Spain's auto manufacturing sector is the third-biggest in Europe and accounts for just under 10 percent of the country's economic output and 15 percent of exports.
The Spanish economy has been hard hit by the recession with its unemployment figures doubling.
The nations unemployment rate now stands at 17.4 percent.