Auto sector leads the way

The auto industry has once again proven its ability for nimble decision-making and renewed its support for Spain-based manufacturing, even as the EU threatens to toughen up environmental regulations.

US automaker Ford will invest 812 million euroat its Valencian plant over the next two years, hopefully creating over 1,000 new jobs. Of this amount - Ford's largest investment in Spain in the last 35 years - 230 million eurowill go toward making two versions of the crossover vehicle Kuga, while the rest will help manufacture the Transit Connect van. This is on top of the 312 million euro recently announced to produce two versions of the C-Max people carrier model at the Almussafes plant. The Valencian factory was selected over Craiova, in Romania, for production of the Transit, which is part of Ford's strategy to launch 20 new models over the next three years, said Stephen Odell, CEO of Ford Europe.

Industry Minister Miguel Sebastián, who attended an event in Valencia last week to announce the investment, said Ford's decision proves that Spain "is an attractive place to invest."

Meanwhile, the head of the carmakers association Anfac noted that during these last two years of economic crisis in Spain, 11 new models have come to Spanish factories. "It is clear that the social peace or lack of conflict, together with flexibility measures negotiated between employers and unions as part of their collective bargaining, have been major assets in the decision-making process," said Luis Valero. An Anfac report released earlier this month shows that car sales fell 23.3 percent in May, for an accumulated January-to-May decline of 25.7 percent, reflecting the end of state incentives to buy vehicles.

Besides Ford, other auto brands have announced new investments. Seat, a Spanish carmaker that belongs to the Volkswagen group, has begun production at its Martorell plant of the Q3 model for Audi (another group brand). The joint investment of ¤330 million will provide wages for 1,500 workers, including 700 new employees. In total, Seat hopes to expand its staff this year by around 1,000 people. Over the last four years, the company has invested over 2 billion euroin Martorell, and Seat's board chairman, Francisco García Sanz, said a similar extra amount could be pumped in over the next four years.

Renault announced a 500-million europlan in late 2009 to build a new engine and two car models in Valladolid, the electric vehicle Twizy and a conventional car in the same segment as the Clio, of which it hopes to produce 80,000 units a year beginning in 2013.

Meanwhile, Opel began making the Meriva model a year ago following a400 million eurooutlay, and preparations are underway for the new Corsa to be made at the Figueruelas plant within the next three years.

The French group PSA Peugeot-Citroën is also readying for a new model to be made at its Villaverde plant in Madrid.