MADRID (Reuters) — Volkswagen’s Spanish subsidiary SEAT will rake in almost half of the nearly 900 million euros (about USD$888 million) in government subsidies allocated for electric vehicle development, Spain’s Industry Ministry said on Tuesday, Oct. 25.
Volkswagen said in a statement it would now analyse the ministry’s decision and study its impact so that planned investment projects could be carried out with maximum effectiveness.
The carmaker had previously declined to comment on reports that it was set to receive less than it needed and that it had threatened to drop its plans for a factory if it was too low.
The state funds, part of the so-called PERTE scheme promoting the production of electric and connected vehicles, will be doled out to 10 e-mobility projects submitted by companies that also include carmakers Mercedes-Benz, Opel, Renault and Peugeot.
The SEAT-led project Future: Fast Forward will receive 397.4 million euros of the 877.2 million total that are to be disbursed in PERTE’s first phase, the ministry said.
The project, in which 60 other Volkswagen-linked companies also take part, foresees an investment of 10 billion euros to electrify Spain’s auto industry and turn the country into a European hub for e-vehicle and battery production.
Industry Minister Reyes Maroto said the projects showed Spain’s “great potential” to lead e-mobility in Europe and promised to “continue working to make more public resources available to the sector.”
The companies will start receiving the money before the end of the year and 90 percent of the aid granted to each beneficiary will be paid out in advance, the ministry said.
This first round of subsidies will be followed by a new phase, in which another over 2 billion euros will be disbursed, to provide continuity to the support the sector needs to successfully tackle electrification, it added.
By Reuters. (Reporting by David Latona; Additional reporting by Victoria Waldersee; Editing by Andrei Khalip and Bernadette Baum)