Sixty-eight percent of official licensed car dealers will lose money this year. Several factors explain the situation. First, fewer and fewer new vehicles are being bought. Annual sales have dropped more than twenty percent, and recent years have been similarly disappointing. So disappointing, in fact, that dealers have been forced to slash prices and leave interest rates around two percent.
Second, post-sale consumption such as spare parts and garage repairs have also dropped significantly. These components are typically the most lucrative sales in the automotive business.
All of this suggests that Spain's cars are aging. In some cases, vehicles have not been to a garage to receive required tune ups and repairs. A situation like this could lead to consolidation within the sector.
