The Spanish government, facing an election next month, plans to extend a car purchase subsidy scheme that has massively boosted sales until the middle of next year, a source at the Industry Ministry said.
Spain has renewed subsidies several times in recent years, and car sales have grown for the past 26 months in a row, helping contribute to an economic recovery after a prolonged slump.
The plan, which offers consumers funds toward a new car when turning in an old one, was last extended by the government in May with a 225 million euro ($238 million) package.
The program was due to expire at the end of the year but will be extended until July 31, 2016, using leftover funds from the May package, the ministry source said Monday.
The source confirmed comments made by Industry Ministry official Begona Cristeto earlier on Monday and reported by Spanish media.
Spain's parliament has been dissolved ahead of the Dec. 20 election, but cabinet ministers can still approve some measures.
Prime Minister Mariano Rajoy's center-right People's Party (PP) is starting to gain ground in some opinion polls, though still seems far from securing another majority.
The car-scrapping scheme aims to reduce the number of older vehicles on the road, improving road safety and supporting the car industry.
Consumers get about 750 euros in subsidies per car from the state, in addition to similar discounts from car manufacturers as part of the scheme.
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