Spain and Portugal are trying to unite their automotive sectors to offer the industry an alternative to the emerging economies of eastern Europe.

Automotive News Europe said that several Spanish and Portuguese automotive managers met last week to discuss possible joint ventures. Their intention is to form a bloc that can compete more effectively against the lure of lower wages and growing demand for cars in eastern Europe.

The effort comes as 10 countries are joining the European Union and eastern Europe is attracting increased investment. With three new plants under construction, the cluster of Poland, Czech Republic, Slovakia and Hungary will have a dozen auto assembly plants by 2006, compared to 15 in Spain and Portugal.

So Spain and Portugal are preparing to talk up the existing assembly capacity and related supplier networks already established there, much of it spurred by Spain and Portugal joining the EU in 1986 as low-wage havens. Beyond the combined assembly capacity, Portugal is a world leader in supplying moulds for plastics production.

“If we join our forces, we can complement each other and offer an important alternative to eastern Europe,” said Guy Viseu, managing director of Faurecia Seats Portugal.

Luis Valero, president of ANFAC, the Spanish automakers association, said: “Spain has the strong advantage of having one of Europe’s highest assembly plant capacities. We produce more than three million cars per year, 82% of them exported.”