Merkel Skeptical about Forcing German Carmakers to Retrofit Diesels

German Chancellor Angela Merkel makes it clear that she does not support city bans on older diesels or schemes that would force carmakers to clean up such vehicles.

Last week Der Spiegel reported that the government might create a co-funded, multi-billion-euro effort to retrofit older diesels with costly but cleaner emission controls.

Merkel agrees that customers and taxpayers should not be made accountable for “serious mistakes” made by Volkswagen and other carmakers. But she also asserts that the benefits and costs of remedial action must be “proportionate.”

A German court ruled last month that cities have the right to at least temporarily ban diesels to help minimize NOx pollution. Analysts say implementing such measures could hurt the resale value of as many as 15 million diesels currently on the road.

Merkel opines that only 10 cities in Germany will exceed nitrogen oxide emission levels within three years compared with 70 that don’t comply today. Critics grouse that her administration, which has defended Germany’s powerful auto industry from regulatory attacks, is “remotely controlled” by carmakers.

German manufacturers so far have agreed to upgrade emission control software, a relatively cheap fix, in 5.3 million diesels by the end of the year. The carmakers say the update can lower NOx emissions by as much as 30%.

Several of the companies also have extended into this year programs that reward owners for trading in old diesels for new ones.