According to recent reports, hefty government subsidies increased Spanish car sales in the month of March whereas consumer confidence picked up slightly from depressed levels, adding to signals Spain is emerging from slump at a crawl rather than a run.

Moreover, as per the note released by the Carmaker association ANFAC, sales increased by 63.1 per cent year-on-year in the month of March 2010 as compared with 124,756 units, boosted by subsidies for car buyers.

Further, the sales increase, which accompanied by a growth of 47% in the month of February also driven by scrappage incentives for buyers opting in old cars for new, chimed in with a pick-up in the consumer confidence index, which still remained at low levels.

Meanwhile, both releases, together with an increase in the manufacturing PMI index for the first time in more than two years, will motivate economists' thoughts that Spain may have appeared in the first quarter from a slump that saw the economy contract by 3.6% in year 2009.

On the other hand, the car association seized on the optimistic sales data to call for the federal government to increase the subsidies, which include almost 2,000 euros (US$2,700) for new cars acquisitions, for the complete year.