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Car industry crisis

Car sales in Portugal are expected to drop by a “dramatic” 18.5% on last year, according to Portugal’s Automobile Association (ACAP).

Sales in January this year fell  47.4% in comparison with the same month in 2011 and now ACAP is calling on the government to reintroduce incentives for people to scrap old cars.

An ACAP spokesman said: “The government is shooting itself in the foot by refusing to grant incentives to the car industry as instead of increasing tax revenue, it is actually reducing it (from a lack of sales).”

Around 2,600 companies in the automobile sector are expected to close this year, with 21,000 jobs lost, said ACAP.

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