As Europe Sours on Diesel, Germany Fights to Save It

As Europe Sours on Diesel, Germany Fights to Save It

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Most of the software upgrades had already been announced by the German manufacturers, while politicians and automotive executives alike rejected calls by environmental groups to force carmakers to add antipollution hardware like better catalytic converters. And they were unanimous in opposing plans by some cities to ban diesels from downtown areas.

“The government’s chumminess with the auto industry continues,” Oliver Krischer, a leader of the opposition Green Party, said in a statement Wednesday. “While China, California, Norway and many others are tackling electromobility, the government is turning Germany into a diesel museum.”

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In fact, as far as auto industry leaders were concerned on Wednesday, diesel remained central to their ambitions.

“Future mobility will definitely depend on state-of-the-art diesels as well,” Harald Krüger, the chief executive of BMW, said in a statement. The carmaker said it would offer a bonus of up to €2,000 to anyone who traded in an older diesel vehicle for a new BMW electric or hybrid car — or a diesel that met the latest emissions standards. Volkswagen and other carmakers said they would offer similar incentives.

Wednesday’s meeting between ministers, state leaders and car company chiefs was an attempt to contain a crisis of confidence that threatens Germany’s most important industry, and perhaps even its national identity, ahead of elections next month.

Volkswagen, Daimler and BMW confront growing public outrage domestically and overseas for underplaying the health effects of diesel fumes and, in at least some cases, misleading customers about how much harmful nitrogen oxides their cars produce in everyday use.

Leaders of both major political parties, meanwhile, face criticism that they have been too cozy with carmakers, blocking stricter European Union regulation of diesel emissions while providing tax breaks on diesel fuel.

German Chancellor Angela Merkel is under particular pressure ahead of the election on Sept. 24, in which she is seeking a fourth term in office. She has a long record of advocating for the auto industry, once even complaining about California’s strict limits on vehicle emissions while visiting the state’s governor at the time, Arnold Schwarzenegger.

Despite the announcements, there were hints of conflict among the participants at Wednesday’s meeting.

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Horst Seehofer, prime minister of the state of Bavaria, called for the government to provide financial incentives for Germans to trade in old vehicles. But Barbara Hendricks, the German environment minister, blamed automakers for the diesel crisis and said they should not expect government help.

Foreign manufacturers, including Ford of Europe, which is based in Cologne, drew sharp criticism Wednesday after they declined to participate in the €500 million fund to improve urban air quality. Ford said it would take other measures to reduce emissions, including incentives for people to trade in older cars.

Vehicles are Germany’s single most important export product and, in many parts of the world, the most visible symbol of German engineering prowess. Within the country, BMWs, Mercedes-Benzes and Porsches are a source of considerable pride and an essential part of the postwar national self-image.

Diesels are particularly important to German carmakers, and the technology has a long history here — Rudolf Diesel, a German, invented the diesel engine. Because of diesel’s superior fuel economy today, it is a popular option with buyers of the large luxury cars that are profit centers for the industry. Until recently, Diesels outsold gasoline cars in Europe, thanks in part to de facto subsidies.

But their sales have been plummeting amid growing awareness that diesel exhaust causes serious lung ailments, including asthma and cancer. In July, sales of diesels in Germany fell 13 percent compared with a year earlier, according to government figures published on Wednesday.

A further impediment to sales is that numerous cities around Europe, including BMW’s home of Munich, are considering bans on older diesel cars. The city governments of Madrid and Athens have already said they will ban diesels altogether in 2025. Britain and France have said they want to end sales of new diesel vehicles by 2040.

Last week, a lower court judge in Stuttgart ruled that a ban on diesels in the city center was the only way to address nitrogen oxide pollution that frequently exceeded levels considered acceptable. If affirmed on appeal, the decision could pave the way for widespread diesel bans.

Why Diesel Became So Popular in Europe

Over the last 20 years, diesel cars have taken a strong hold on the European market, thanks in large part to regulations that made them cheaper to fill up than gasoline-powered cars.

Moves like those have left many diesel owners fearing that the resale value of their vehicles will plummet.

A sense of betrayal has deepened in Germany in recent weeks following reports that Volkswagen, BMW and Daimler may have secretly agreed to cut corners on emissions equipment to save money.

The carmakers could face a wave of financial penalties if it is proven that they colluded to minimize how much money they spent on emissions equipment. Volkswagen has already agreed to pay more than $22 billion in the United States in fines and settlements after admitting that it had programmed diesel cars to cheat on emissions tests.

In the United States and Canada, lawyers have filed suits claiming that collusion among the automakers did harm to buyers of German cars.

Among owners and environmental activists there is considerable skepticism about whether software fixes alone will make much difference. There is growing pressure for carmakers to retrofit cars with better antipollution hardware, which would be extremely costly.

Auto executives rejected that option Wednesday. “We consider it out of the question to carry out hardware retrofitting,” Matthias Müller, the chief executive of Volkswagen, said during a news conference. “It is questionable what the result would be.”

“I would like my engineers to be working on future-oriented technologies,” he said, “not working on motors that are 10 or 15 years old.”

In a sign of the public anger that the issue has generated, dozens of protesters gathered early Wednesday outside the Transport Ministry, where the summit took place. Activists from the environmental charity Greenpeace hung a banner across the facade of the ministry proclaiming “Welcome to Fort NOX,” a play on the abbreviation for the nitrogen oxides emitted by diesel vehicles.

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