Spanish Prime Minister Pedro Sanchez has announced a 3.7 billion euro ($4.2 billion/£3.3 billion) aid package for the hard-hit auto industry to promote the production and sale of cleaner cars.

The funds will be disbursed by 2022 and will include cash from European recovery funds.

Here are some details of the package, unveiled on Monday:

AID TO PURCHASE NEW LOW-EMISSION CARS

The Spanish government will spend 250 million euros on cash-for-clunker schemes to encourage drivers to buy new low-emission and electric cars in 2020.

Drivers will get up to 4,500 euros to buy a new, cleaner car when they scrap a 20-year-old car. Dealerships will give up to 1,000 euros in additional discounts.

Spain will spend another 100 million euros upgrading official vehicles and will let regional authorities spend 100 million euros of their budget surpluses to upgrade their own fleets.

INDUSTRY LOANS AND TAX BREAKS

Spain will grant 2.6 billion euros in cheap loans and loan guarantees to the industry by 2022, including loans to modernize plants and for companies to renew their fleets.

The government will also approve tax breaks for the industry.

ADDITIONAL GRANTS

The industry will receive up to 415 million euros in grants for research and development and 95 million euros for worker training programmes.

The auto industry represents around 10% of Spanish gross domestic product (GDP) and 19% of exports. It employs 650,000 people directly and as many as 2 million indirectly.

Most factories were idled during Spain´s lockdown as demand for new cars plummeted and supply chains were disrupted.

Japanese car maker Nissan Motors announced last month it would shut down its large plant in Barcelona, leaving as many as 3000 workers unemployed.

(Reporting by Emma Pinedo and Inti Landauro; Editing by Nathan Allen and Jan Harvey)