MADRID ‚Äď As Spain‚Äôs 2000E Plan scrappage program launched last year to drive vehicle sales reaches its end this month, dealers and traders are growing anxious over the ‚ā¨6.5 million ($7.9 million) in financial aid still pending for the new cars they have delivered to date.
Sources from ANFAC, the association of local car manufacturers, say the scrappage plan helped increase registrations to 1,067,369 vehicles in the 12 months ended April 30, up 17.4% from the year-ago period.
The stimulus scheme provides ‚ā¨2,000 ($2,456) to each car buyer for the purchase of a new, more fuel-efficient vehicle and the scrapping of the older model.
Half the money was to be provided by the dealers and traders through price discounts. The remaining ‚ā¨1,000 ($1,228) was to come half from the central government and half from the autonomous regional governments.
However, some autonomous governments chose to apply a different aid, thereby reducing their ‚ā¨500 ($614) contribution, while others increased that amount.
But the auto dealers and traders that already have discounted the price of their vehicles to customers under the 2000E Plan are having trouble recovering that money, as the Spanish Ministry of Industry is rejecting many of their claims.
In a letter sent to GANVAM, the association representing more than 2,300 dealers and 3,000 auto traders in the country, the ministry says some of the requests for financial restitution are incomplete and therefore not legally submitted.
As a consequence, ‚Äúaid demands not registered correctly have been considered as not presented,‚ÄĚ even when the solicitor (dealers and traders) met all the demanded requirements.
GANVAM says what this really means is the Ministry of Industry is refusing to accept responsibility for a glitch that occurred in March, when the government‚Äôs electronic system designed to accept online reimbursement applications crashed due to overwhelming demand.
‚ÄúWe must assume the Ministry of Industry (is refusing) to (consider) any kind of damages for the solicitors‚ÄĚ who were excluded from financial aid under the 2000E Plan, says an angry Juan A. Sanchez, GANVAM president.
Complicating things further, the Spanish Treasury now is insisting dealers and traders pay tax on government funding they did not receive. ‚ÄúIf the (2000E Plan) aid is rejected by the Ministry of Industry, it must not be declared to the Treasury but considered as an additional discount from the auto vendor,‚ÄĚ Sanchez says.
One alternative for dealers and traders is to reclaim the subsidies rejected by the Ministry of Industry from their affected customers, which are not yet aware of the problem.
Another strategy is for the dealers to sue the Ministry of Industry or FITSA, the government agency responsible for the management of the subsidy applications, for damages or recovery of their funds.