MADRID - SEAT, the ailing Spanish subsidiary of German auto giant Volkswagen, said on Monday it will reduce production at its plant in north-eastern Spain due to the downturn in demand caused by the global economic slowdown.

Up to 5,300 workers at its plant in Martorell will face a work reduction of either seven, 23 or 29 days between February and June 30, 2009, it said in a statement.

'SEAT will adjust its production volume at the Martorell plant for the first half next year in the face of the persistent market downturn, particularly in Spain and its main export markets, coupled to future uncertainty in those markets,' it said.

Sales of new cars in Spain plunged by nearly half in November from the equivalent figure last year to 63,068 vehicles owing to sudden slowdown of the economy, mirroring declines in car sales across Europe.

Prime Minister Jose Luis Rodriguez Zapatero's socialist government earmarked 800 million euros (S$1.48 million) of an 11 billion euros economic stimulus package which it unveiled last month to the country's auto sector.

Spain's auto sector accounts for 8.4 per cent of the country's gross domestic product (GDP) and 15 per cent of its exports.