Berlin says it wants to give tax breaks for cars with clean diesel, but a divided cabinet and automobile industry have stalled the effort -- at least for now.
Diesel cars are sparking an unfiltered debate
For years, diesel cars have been considered more environmentally friendly than traditional gasoline motors because they create fewer climate-damaging emissions. The problem has always been that they emit toxic particles that have been linked to cancer and respiratory illnesses.
However, the recent creation of so-called particle filters has made diesel engines safer for consumer use. Proponents say particle filters are the only technology currently available that can cut particle emissions by 99 percent.
But German car makers haven't been quick enough to jump on the bandwagon, and that's beginning to create a political problem in the environmentally progressive country. In contrast to French car makers like Peugeot and Renault, which have embraced particle-filter diesel engines, German companies have instead opted for internal improvements to diesel motors, with moderate successes in reducing particle emissions.
A shot in the arm
German Environment Minister Jürgen Trittin of the Green Party has drafted legislation that would seek to give a shot in the arm to the particle filter business by providing a tax break of €600 ($740) on diesel cars with new particle filters that reduce particle emissions to a stringent limit of 2.5 milligrams per kilometer. But major car makers like Volkswagen have called for a looser limit of 12.5 milligrams.
Environmental groups, the Green Party and factions of the Social Democrats are backing Trittin's calls, which they say is supported by Environment Ministry data claiming that 14,000 people die each year as a result of diesel particle emissions.
But the industry, led by Volkswagen, has fought tooth and nail to avoid being forced to adopt the filters. In an attempt to break the bottleneck, German Chancellor Gerhard Schröder met earlier this week in Berlin with VW CEO Bernd Pischetsrieder and other top European automobile industry executives to discuss future use of particle filters.
"Every seventh job in Germany is still dependent on the automobile industry," said Schröder's spokesman, Bela Anda. "This should not be seen as a call for measures not to be implemented. But it should also make it clear that there are also endeavors in the industry to reach this goal through changes in the internal motors -- and people shouldn't disregard that fact."
After his meeting with Pischetsrieder, Schröder said no decision had been reached as to when particle filters would be included in cars or how they might be filtered. Instead, the chancellor and the executives of Europe's largest car maker decided to leave responsibility for the decision with Brussels. By the end of the year, the EU is expected to produce regulations for emissions norms that would serve as the blueprint for filtering technologies.
For the automobile industry, punting the responsibility to Brussels represents a partial victory, as the standards proposed by Germany's Trittin would likely have been much stricter.
Gerd Lottsiepen, of the German Automobile Club, said the car manufacturers were acting irresponsibly in their fight against technological limits.
"The manufacturers who are now issuing polemical attacks against these limits ... are knowingly acting against the interests of consumers. The customers who buy cars today with yesterday's technology will get stuck paying the piper for the manufacturer's deep sleep. The loss of value for cars without particle filters will be higher than average in the coming years," Lottsiepen said.
To some environmental groups, including Greenpeace, the financial incentive Trittin has proposed does not go far enough.
"The price difference between the systems runs between €300 and €1,300," said Günter Hubmann of Greenpeace. "We're demanding that, for the best system, which is 99 percent effective, a tax break of €999 should be given by the government. How, exactly, that can happen still needs to be negotiated."
Discord in Berlin
The current debate over particle filters also threatens to spark a new row between Environment Minister Trittin and Economics Minister Wolfgang Clement, who just recently locked horns over emissions trading standards for heavy industry.
Responding to the particle filter debate, Clement has said he does not want to add further pressure to car makers while the economy struggles for growth.
Companies like VW say that if particle filters become obligatory, it should not happen before 2007 and that the particle emission limits should be set higher than Trittin's proposed standard. Meanwhile, the opposition parties, including the Christian Democratic Union, have said that promoting specific or special technologies should not be the government's responsibility.
Dacia, Logan, 2004
Though Germany leads Europe in auto exports, the particle filter issue has been driven by the French. There, car-maker Peugeot introduced its first diesel car with a particle filter in 2000, offering the additional safety at the same price as its other diesel offerings. Peugeot's parent company, Autogruppe PSA, is the world's largest self-combusting engine manufacturer, and it has widely introduced particle filters in its diesel cars.
But differences remain between Germany's leading politicians on the best way to move forward with particle filters. And any car tax breaks proposed by the federal government must also be approved by the states that are entitled to the proceeds from the motor vehicle tax.
So far, most states are taking a reserved approach to the proposal, with ministers in some states, like Bavaria, saying it has not yet been proven that the current generation of particle filters are the most effective means of reducing particle emissions from diesel motors.