Volkswagen CEO suggests an end for diesel subsidies

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Of all people, the chief executive of Volkswagen has called on the German government to consider phasing out subsidy for diesel. Let’s not forget that he works for the company that began all the (unplanned) negativity towards diesel.

“We should question the logic and purpose of diesel subsidies,” said Matthias Muller to German newspaper Handelsblatt.

Matthias Muller

Although this does sound startling, Muller is simply repeating what European governments and the EU have committed to: phasing out fossil fuel subsidies by 2020.

The New York Times quoted Tobias Austrup, a transportation expert for Greenpeace, “The government is being urged to phase out diesel subsidies by none other than the biggest diesel fraudster.”

Since dieselgate 2015, sale of diesel-burning passenger cars have been on decline; even if more than half of all cars sold in Europe for 2016 were diesel models. Compounding this are efforts by a few European governments to further discourage customer interest in diesels, such as the additional daily penalty forced on drivers of cars in London which fail to meet European Union emission standards.

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It should be said that over the years, car companies such as Volkswagen have sold a huge number of diesel engined cars. As such, the amount of annual subsidies paid out by governments are substantial.

In the case of Germany, it is said the up to €18.1 billion are for fossil fuel subsidies in the transport sector.

Muller also gave his support for the ban of older diesel vehicles from city centres although he clarifies that modern diesel engines were cleaner and still has legs in them.

Then again, the top exec at Volkswagen does have a reason to sound rather confident. Since the drop of diesel vehicle sales stem more from inconvenient legislation rather than sudden a public distaste for the fuel, it is jut better to embrace the inevitable and concentrate more on technologies that VW has been focussing on recently anyway. By that we mean electrification, as ever.

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