Driving bans likely in German cities following court ruling

28 February 2018

A German court has ruled in favour of allowing major cities in the country to ban diesel cars, a ruling that is likely to have a big impact on the country’s diesel industry.

The ruling means local authorities can ban diesel vehicles from entering big cities around the country. It comes following a global backlash against the technology following the uncovering of the Dieselgate scandal. It could see similar bans across Europe, putting another nail in the coffin of the technology.

The ruling by the country’s highest federal administrative court came after German states had appealed against bans imposed by local courts in Stuttgart and Dusseldorf in cases brought by environmental group DUH over poor air quality.

The court rejected the appeals by the state governments and ordered Stuttgart and Dusseldorf to amend their anti-pollution plans, saying that city bans can be implemented even without nationwide rules. The DUH sued the two cities to force them to implement driving bans, after about 70 German cities were found to exceed European Union nitrogen oxide (NOx) limits, with ten likely to implement bans.

German Government has been outspoken in support of the country’s diesel industry against city bans, so the ruling can be seen as an embarrassment for Chancellor Angela Merkel, who had lobbied for special measures for cities that are over their NOx targets.

One potential solution is for vehicles to be retrofitted with hardware upgrades to control emission levels. Following a national diesel forum in August 2017, manufacturers agreed to recall 5.3 million cars for software updates, while drivers of older models were offered the opportunity to exchange their vehicles for newer, less polluting models in manufacturer backed scrappage schemes. A second forum also backed payments to cities to help them beat the problems.

While any ban is unlikely to affect new diesel models, with drivers already turning away from the technology, there is likely to be an impact on sales. Drivers may not want to invest in a vehicle that could be unable to enter certain cities in a few years’ time, while the used market may also suffer, especially values.

′This verdict creates important legal framework conditions, but the decisive political and market measures are far from having been adequately met,’ said Schwacke Managing Director Thorsten Barg. The Autovista Group, therefore, assumes that one will continue to see insecure customers, who would now be increasingly ′more likely to use petrol.’

Schwacke also expects uncertainty from fleet operators. These should now ′exactly calculate for their new contracts, whether diesel with increasing leasing rates overall costs through lower operating costs are still more cost-effective than gasoline or alternatively powered vehicles.’

The German Government is now expected to draw up new legislation, allowing local governments to put bans into place. It will also likely implement plans to make public transport in cities that do implement such action free, reducing the burden on commuters.