At Frankfurt auto show, Merkel urges car industry to restore trust

FRANKFURT AM MAIN: Chancellor Angela Merkel urged car giants to win back the trust of "deceived" drivers as she opened the Frankfurt auto show Thursday, walking a fine line between berating the scandal-hit industry and praising its role as the backbone of the German economy.
With 10 days to go until a general election, the 'dieselgate' emissions cheating scandal has emerged as a top campaign issue and cast a shadow over the glitzy Frankfurt International Motor Show (IAA).
Once nicknamed the "car chancellor" for her cosy relations to the industry, Merkel's tone has shifted in recent weeks to include more robust attacks on auto company bosses.
"Auto industry firms excessively exploited regulatory loopholes, they haven't only damaged themselves, but above all deceived and disappointed consumers and the authorities," she said in stern remarks at the IAA opening ceremony.
But Merkel, who is on track to win a fourth term, was also careful not to alienate the car sector, highlighting its role as a "key industry" that employs some 870,000 people nationwide and is an important engine of growth for Germany and Europe.
"The auto industry must do its utmost to win back credibility and trust as soon as possible, in their own interest and in the interests of their employees and of Germany as a whole," she said.
Her knuckle-rapping speech at the biennial IAA comes as pollution-plagued German cities mull diesel bans and voters worry about the resale value of their cars, while Merkel has herself faced criticism for going too easy on the sector in the past.
"It's somewhat frustrating for Angela Merkel to see that the close ties she has nurtured with the auto sector are not helping her right now," said industry expert Stefan Bratzel of Germany's Center for Automotive Management.
"The mood has changed and the government is now looking at the sector and its main players more soberly," he said.
'Avoid bans'
In her speech, Merkel welcomed efforts by German carmakers to step up their push towards zero-emissions electric cars, while continuing to defend diesel.
"There's no escaping that we will need the combustion engine for decades to come," she told the audience, which included Facebook number two Sheryl Sandberg.
"On the other hand, we need to invest more than ever in the research and development of new driving technologies," she said. "This is the only way we can avoid diesel driving bans."
The dieselgate crisis erupted at the height of the last IAA in 2015 when Volkswagen stunningly confessed to installing cheating software in 11 million diesel cars worldwide designed to dupe pollution tests.
In reality, the cars were spewing up to 40 times the permissible levels of toxic nitrogen oxides (NOx).
Similar suspicions have since spread to other carmakers, highlighting just how much the industry has resorted to skirting the rules, or outright cheating, to cover up high NOx emissions.
The scandal deepened in July on reports that Daimler, BMW, Volkswagen and its Audi and Porsche subsidiaries for years colluded on technical specifications — including emissions technology.
The revelations prompted some 70 cities, including the car industry bastions of Stuttgart and Munich, to consider banning dirty diesels from their smog-clogged roads, fuelling concern among drivers.
'Crucial' diesel
The beleaguered sector has since tried to make amends by shifting gears to the cleaner cars of the future, with BMW, VW and Daimler all announcing ambitious goals for hybrid and electric cars at the IAA.
But take-up among consumers has been slow for now, with e-cars accounting for barely one percent of sales in Europe.
And after years of heavy investments in diesel, which was invented in Germany, the nation's vaunted auto giants aren't ready to let go yet.
"We know that some trust has been lost. Winning this back is our biggest concern," Matthias Wissmann, president of the VDA auto industry association, said in his own speech at the IAA ceremony, while opposing calls for driving bans.
Long touted as more environmentally friendly than petrol because of its lower climate-altering carbon dioxide emissions, diesel has a key role to play in helping countries meet the targets of the Paris climate accords, carmakers argue.
"The latest generation of diesel vehicles is crucial for our continuous efforts to decarbonise road transport," Dieter Zetsche, Daimler chief executive and head of the European Automobile Manufacturers' Association (Acea), said at the IAA on Wednesday. — AFP