Spain launches a $4.2 billion coronavirus auto industry stimulus package
- Spain has launched a $4.2 billion stimulus programme for the country's automotive industry.
- Around 70% of the funds will be earmarked for the sector's "value chain" and the rest will be invested in existing car fleets and electrifying public transport.
- Spain was one of the countries to be hit very badly by the pandemic early on, leading to a strict lockdown.
- Last month, Japanese auto giant Nissan decided to shut its Barcelona factories, causing 3,000 job losses.
Spain launched a 3.75 billion euros ($4.2 billion) stimulus program to help the country's automotive industry recover from the fallout of coronavirus.
Almost 70% of the funds will be earmarked for the sector's "value chain" and other parts will be invested in renewing existing car fleets and electrifying public transport, Spanish prime minister Pedro Sanchez said in a speech Monday, multiple media outlets report.
Some of the funds will also be invested in replacing existing cars that are older than 10 years with more energy-efficient and newer models.
The automotive industry is considered one of the many lifelines of the Spanish economy, with 10% of GDP coming from the sector.
Spain was one of the first few countries to be badly hit by the pandemic in Europe, and imposed one of the most stringent lockdowns.
Data from John Hopkins University shows more than 243,000 people in Spain have been infected by the virus, and it has claimed the lives of more than 27,000 people in the country.
The Spanish economy contracted by 5.2% in the first quarter of 2020, and the Bank of Spain is bracing for a fall between 6.6% to 13.6% this year.
Spain is Europe's second largest car manufacturing country, producing around 3 million cars every year. It is behind only Germany in the number of autos it builds, according to Statista.
Last month Japanese car manufacturer Nissan Motor decided to close its manufacturing plants in Catalonia, a move which led to the loss of around 3,000 jobs.