Merkel Cabinet Backs Plan to Ease Diesel-Car Bans in Cities

(Bloomberg) -- Chancellor Angela Merkel’s cabinet backed plans to stamp out Germany’s diesel-car crisis, including steps to ease driving bans in dozens of cities.

While there’s no deal yet for carmakers to bear the cost of retrofitting diesel-powered passenger vehicles, the blueprint lays out measures such as incentives to get older vehicles off the road. Merkel is battling public discontent about her handling of the emissions scandal, which began in 2015 with revelations of Volkswagen AG’s emissions cheating.

Spurring the chancellor is a regional election on Sunday in Hesse, a region that includes Frankfurt, Germany’s financial center, where her Christian Democratic Union’s hold on power is at stake. In a reversal from earlier this week, Frankfurt won’t qualify for a plan to ease restrictions on diesel cars because the latest measurements of nitrogen-dioxide emissions in the city are too high, chancellery chief of staff Helge Braun said Wednesday.

“We want to ensure that people in Germany who bought diesel cars can remain mobile in the affected regions,” Braun told reporters in Berlin.

The proposed legislation will include a twist introduced by Merkel this week: diesel bans in cities with nitrogen oxide emissions of 50 micrograms per cubic meter or less would would be deemed “disproportionate,” even though they breach the European Union’s threshold of 40 micrograms.

Court Bans

Merkel’s goal is to exempt dozens of urban areas as she seeks to stay ahead of court-ordered bans on diesel vehicles spreading across Germany.

For 15 heavily polluted cities, including Munich, Stuttgart, Cologne and Frankfurt, hardware retrofits and the government’s “cash for clunkers” will have to ensure that they get back within the limit, Braun said.

At a meeting on Oct. 1, Merkel’s coalition pressed Volkswagen, Daimler AG and BMW AG to offer trade-in rebates for older diesel vehicles to avoid driving bans in urban areas to defuse a crisis that’s sullying Germany’s reputation as an automotive leader.

“We’re in intense discussions with the auto industry” on hardware upgrades, Braun said. “Since the automakers have squandered so much trust, we believe it’s important and the right thing for the auto industry to offer a promise to customers that they can stay mobile, even in cases where driving bans can’t be avoided.”

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