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A diesel muddle

Diesel is once again playing havoc with German politics and car dealerships alike.
Politicians are bidding for and against diesel engines for their own electoral ends and at the same time creating uncertainty among consumers.
There are calls for banning old diesel cars from cities such as Stuttgart and Munich which could mean thousands of almost new and used cars would remain unsold.
Dealers in Germany are complaining that they are unable to sell up to 300,000 cars equipped with Euro 5 engines because of consumer fears of the diesel ban in major cities repeated by politicians in the current election campaigns.
The unsold cars represent a value of €4.5 billion ($5.4 billion), causing hardships for the traders and forcing most of them to drop prices drastically to reduce their stock.
The situation is complicated by many diesel car owners who want to sell their cars as soon as possible to avoid further falling values and switch to cleaner technology.
This is happening in many European countries too.
In Britain, the government actually encouraged diesel engines as a way to lower CO2 emissions.
But when NOx emissions were deemed more harmful, threats and penalties were directed at innocent diesel-car owners who followed government advice.
There are close to 20 million diesel cars in the UK, Germany and France that do not meet the latest clean standards of Euro 6.
While consumers have a good case against governments for shifting policies and confusing the market, causing values to collapse, politicians are pushing consumers to sue car companies for compensation, which may not be a viable option for most people unless done collectively.
From a consumer point of view, the current situation is a result of governments interfering in market mechanisms and companies being slow to adapt to changing environments, leaving consumers to pick up the pieces.
This is one positive aspect for Gulf markets for not allowing diesel passenger cars in the first place. This did not come by decree but by pure market forces.
Diesel quality in the region was not deemed clean enough for modern diesel cars. Now modern diesel cars are not clean enough for the markets.
• Adel Murad is a senior motoring and business journalist, based in London.
Diesel is once again playing havoc with German politics and car dealerships alike.
Politicians are bidding for and against diesel engines for their own electoral ends and at the same time creating uncertainty among consumers.
There are calls for banning old diesel cars from cities such as Stuttgart and Munich which could mean thousands of almost new and used cars would remain unsold.
Dealers in Germany are complaining that they are unable to sell up to 300,000 cars equipped with Euro 5 engines because of consumer fears of the diesel ban in major cities repeated by politicians in the current election campaigns.
The unsold cars represent a value of €4.5 billion ($5.4 billion), causing hardships for the traders and forcing most of them to drop prices drastically to reduce their stock.
The situation is complicated by many diesel car owners who want to sell their cars as soon as possible to avoid further falling values and switch to cleaner technology.
This is happening in many European countries too.
In Britain, the government actually encouraged diesel engines as a way to lower CO2 emissions.
But when NOx emissions were deemed more harmful, threats and penalties were directed at innocent diesel-car owners who followed government advice.
There are close to 20 million diesel cars in the UK, Germany and France that do not meet the latest clean standards of Euro 6.
While consumers have a good case against governments for shifting policies and confusing the market, causing values to collapse, politicians are pushing consumers to sue car companies for compensation, which may not be a viable option for most people unless done collectively.
From a consumer point of view, the current situation is a result of governments interfering in market mechanisms and companies being slow to adapt to changing environments, leaving consumers to pick up the pieces.
This is one positive aspect for Gulf markets for not allowing diesel passenger cars in the first place. This did not come by decree but by pure market forces.
Diesel quality in the region was not deemed clean enough for modern diesel cars. Now modern diesel cars are not clean enough for the markets.
• Adel Murad is a senior motoring and business journalist, based in London.

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