Germany weighs joint fund with automakers to refit diesel cars: Spiegel

BERLIN (Reuters) - The German government is considering setting up a joint fund with carmakers to pay for advanced exhaust systems that make diesel cars cleaner, Der Spiegel magazine reported on Friday.

Chancellor Angela Merkel and some of her ministers will discuss at a cabinet retreat next week ways to avert driving bans in major cities after Germany’s top administrative court in February allowed local authorities to bar heavily polluting diesel cars.

The German government may ask carmakers to contribute 5 billion euros ($6.13 billion) to the fund which would also include government payments, Der Spiegel reported, without being more specific.

A spokeswoman for Germany’s VDA auto industry lobby, representing major carmakers Volkswagen (VOWG_p.DE), Daimler and BMW, said it had no knowledge of such a government proposal.

Transport Minister Andreas Scheuer declined to comment on the report. In an emailed statement he said one of the items on the agenda at the cabinet retreat is to “work hard with goal of making air quality in our cities even better”.

There has been a global backlash against diesel-engine cars since Volkswagen (VW) admitted in September 2015 to cheating U.S. exhaust tests. The scandal has spread across the industry and boosted investment in electric vehicles.

Der Spiegel said the “comprehensive” exhaust refit plan would affect a large part of the 15 million diesel cars in Germany, of which only 2.7 million are equipped with the latest Euro-6 emissions technology.

The magazine said cars in big cities such as Munich and Stuttgart where air quality is particularly poor should be fitted with so-called selective catalytic reduction (SCR) systems that require AdBlue injection technology.