Car sales in Spain, Europe´s third-largest automobile market, could fall 2.5%-3% next year as consumers feel the pinch from higher interest rates and an uncertain economic outlook, the Ganvan trade association has announced, contradicting a 2% sales increase forecast from dealers´ association Faconauto.

In a statement obtained by just-auto, Ganvan, which represents automobile and parts retailers, said fresh doubts about Spain´s economic and interest rate outlook could drag down sales in 2008.

Ganvan´s estimates are at loggerheads with those of Faconauto which in November predicted car sales will rise 2% to 1.61m units next year. The federation said the government´s new eco tax (which rewards eco-friendly car purchases) will fuel sales. It also quoted some analysts´ views that Spain´s economy will grow 3%-3.3% in 2008 and that the state is likely to lower interest rates after several hikes in the last year that are dampening big-ticket consumer purchases.

This year, car sales will decline 2% to 1.6m units, Ganvan said. However, the lobby said that used vehicle sales rose 5.8% to 1.37m in the January-October period as skittish consumers shopped for bargains.

In common with Faconuato, the lobby criticised Spain´s government for failing to support the automobile industry, saying that it suffers from "autophobia."

Ganvan president Juan Antonio Sanchez Torres expressed doubts that Madrid will renovate the Prever trade-in programme, which has been a great success, to help retire ancient used cars in Spain -the industry´s preferred alternative to cut CO2 emissions.

"We don´t understand why a government keen to fight pollution has forgotten about the 6m used vehicles over 10 years old that circulate in our roads," Sanchez Torres said. "The government is only interested in drawing EUR23bn from automobile taxes each year."

Ivan Castano