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Italy new car sales recover in March

Italian new car sales recovered significantly in March, thanks to government incentives for the purchase of new, less polluting cars, research group Promotor said.

In a brief statement ahead of the government's monthly publication of figures, Promotor said registrations had risen strongly and orders, which usually translate into registrations, had also shown good growth.

The group, which conducts a monthly survey of car dealers, did not give any specific figures.

On Friday, the head of UNRAE, the foreign car makers' association in Italy, said sales last month should at least match the level reached in March 2008. Orders, meanwhile, would show double-digit growth, he said.

Fiat SpA's chairman made a similar observation in remarks to shareholders at their annual meeting on Friday, saying the market had responded positively to the incentives.

Shares in Fiat were down 2.7% at €5.14, underperforming the DJ Stoxx auto industry index a day after rising more than 5%.

The government came out with its package of incentives in February, so March will be the first full month to show their effect on sales.

Italy is the home to Fiat, which along with every other car makers has struggled in the face of declining sales in the worst industry crisis in decades.

In February, new car sales fell 24.45% in Italy, leading to a 28.51% fall for the first two months of the year.

Governments across Europe have introduced incentives to soften this drop in sales. Some of them have gone further by offering aid to their respective car industries. (Reuters)