News Analysis: VW chief's comments on diesel subsidies spark debate in Germany

BERLIN, Dec. 13 (Xinhua) -- Suggestions made by Volkswagen Chief Executive Officer (CEO) Matthias Mueller to eliminate subsidies for diesel vehicles in favor of cleaner technologies have witnessed an angry backlash in Germany.

Free Democratic Party (FDP) secretary general Nicola Beer responded on Wednesday by describing Mueller as a "diesel Judas" on twitter.

She sought to draw attention to what she perceived as Volkswagen's hypocrisy of having undermined the international reputation of diesel motors with its involvement in the emissions cheating scandal -- only to turn around and ask for government handouts to shift its business model towards electric mobility.

"This is a feigned concern for technical progress," Beer added.

Mueller told the newspaper "Handelsblatt" that Germany's transition to environmentally-friendly vehicles could only succeed if the government ceased to subside diesel cars. He proposed shifting public funds towards research and investment into new technologies which were less harmful to the environment instead.

German carmakers would be able to weather such a reform "without suffering from existential fears", Mueller said. He could further envision a "blue placard" system which banned heavily-polluting diesel vehicles from inner city areas.

The number of new registrations for diesel cars has fallen steadily in Germany in the wake of the global "dieselgate" scandal. Struggling to repair their global image, leading German carmakers including Volkswagen have since announced investments worth billions of euros into electric mobility.

However, Beer criticized that Mueller's proposals would amount to nothing less than a double whammy for diesel owners who were already reeling from the consequences of the "dieselgate" scandal after having been sold cars on false premises. Rather than trying to impose additional costs on these customers with higher vehicle taxes, Volkwagen should seek to first compensate customers properly for the company's fraudulent behavior.

The German Federation for Motor Trades and Repairs (ZDK) reacted with similar disbelief. Volkswagen was "adding fuel to the flames" of the crisis which it had itself caused in diesel motors, ZDK director Axel Koblitz told German press.

Koblitz complained that millions of motorists had acquired relatively expensive and highly-taxed diesel vehicles under the impression that they were saving on fuel costs and helping to lower CO2 emissions. These drivers were now confronted with the prospect of driving bans in cities due to unexpectedly high nitrogen oxide levels and a massive deterioration in the value of their cars.

German Transport Minister Christian Schmidt voiced his irritation over Mueller's proposals as well, while several other automotive industry representatives stressed that the Volkswagen executive's comments only reflected his personal views.

Executives at rival carmakers BMW and Daimler expressed anger that Mueller had not held any consultations with his counterparts prior to the widely-publicized interview. Both firms reiterated their support for the stance of the Automotive Industry Association (VDA) which recently argued against cutting diesel subsidies at an industry conference.

By contrast, although Mueller may appear an unlikely ally given his efforts over the past years to shield Volkswagen from the consequences of the "dieselgate" scandal, his proposals were supported in principal by German environmental organizations and the Green party (Gruene).

Nevertheless, things might not change so quickly as Steffen Seibert, spokesperson of Chancellor Angela Merkel's (CDU), told press that the government had "no intention" of changing the current taxation regime for diesel vehicles. Enditem