Automobile industry ends the year in reverse gear

Last year was one of the worst on record for the Spanish car industry, as an anemic economic recovery evaporated and already-giddy unemployment levels turned even higher.

According to figures released Monday by the industry associations ANFAC and GANVAM, registrations of new passenger cars fell 17.7 percent to 808,059 units. That was the lowest figure since the recession of 1993 when Spain's population was only 39.8 million, compared with 47.2 million in 2011. Sales in 2010 climbed 3.1 percent to just under a million due to a government direct-subsidy scheme.

"The year 2011 [...] was a year to forget, marking as it did a somber milestone for the automobile sector on a par with 1993," GANVAM Chairman Juan Antonio Sánchez Torres said in a statement.

The only segments of the market that escaped the crisis were luxury cars (sales of which climbed 83 percent), small SUVs and people carriers.

In December alone, new automobile purchases declined 3.6 percent from a year earlier to 66,458 units. The size of the fall was lower compared with other months, suggesting the market might be starting to bottom out.

ANFAC predicts sales this year will be around last year's levels at 800,000. The Spanish economy is estimated to have contracted again in the last three months of 2011, with the government expecting weakness in activity to extend into this year.

The car industry accounts for about 6 percent of Spain's GDP and about 8.7 percent of the country's jobs.

Sales to individuals last year were among the worst hit, reflecting high unemployment, tight credit, and weak consumer confidence. Purchases in this segment dropped 33.6 percent from a year earlier to 387,831 units. Sales to individuals accounted for only 48 percent of total purchases, compared with 60 percent in 2007 before the crisis broke.

Sales to car-hire firms rose 4.3 percent to 141,147 units, reflecting a revival in the tourist industry.