Italian transportation ministry figures show that the Italian car market continued its downward trend in June. New car sales declined by 17.2% over last year to stand at 180,300 units.

Fiat's Group's market share in Italy continues to decline according to the figures, which show a share of 28.7% against 34.2% in the same month of last year and 31.1% in May.

The Italian car market is in decline this year after a period of heavy discounting and the decline is compounding Fiat's current problems, which include rising financial losses and low production capacity utilisation. It has been suggested that a scrapping incentive could be introduced to kick-start the market and help Fiat.

In 1997 a scrapping scheme in Italy kick-started the car market to 2.4 million units from 1.7 million units the year before.