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German High Court to Rule on Legality of City Diesel Bans
Germany’s highest court for administrative disputes is expected to decide on Thursday whether cities can ban diesels to help improve local air quality.
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Germany’s highest court for administrative disputes is expected to decide on Thursday whether cities can ban diesels to help improve local air quality.
The review was prompted by rulings at the local court level directing certain cities to prohibit the operation of older diesels on days when air pollution is especially heavy.
Regions that are home to significant auto industry operations have appealed the decisions. They claim that courts and municipalities lack the legal right to impose bans at the local level.
Carmakers worry that temporary prohibitions could lead to permanent measures that limit where diesels are allowed to operate. Such an outcome would disrupt the market by slashing the value of diesels already on the road. One result would be big losses for carmakers on leased vehicles, whose agreements are based on an expected residual value at the end of the term.
Reuters cites an estimate by Bernstein Research that diesel bans in the European market would hurt PSA the most, followed by Renault, Daimler, BMW and Volkswagen.
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