I think you misunderstood it. Take a look at the map and you'll see pontevedra is tiny, a circle barely 2km wide. Car owners obviously don't work there but commute somewhere else (most probably Vigo in the south). Story goes, their roads where clogged with passing traffic, commuters passing by pontevedra going somewhere else. Then pontevedra got rid of all roads and made a big ring road around the city. So they turned their city into a proverbial cul de sac to escape from other people's traffic. If every other community in the way did the same around them guess what.