Volkswagen offers ‘rebates’ in Germany

Bloomberg

Volkswagen AG is offering as much as 10,000 euros ($11,800) to drivers in Germany willing to trade in older diesel cars for a newer auto, intensifying a push to get aging vehicles off the road as the company’s emissions scandal evolves into an industrywide crackdown.
The namesake VW brand will give back 2,000 euros to buyers of a new Up! city car and as much as 10,000 euros toward a Touareg sport utility vehicle, the division said on Tuesday in a statement. The incentive applies to trade-ins of models from any manufacturer. Rebates at Volkswagen’s upscale Audi nameplate range from 3,000 euros to 10,000 euros, and the Porsche sports car marque is providing a 5,000-euro reduction Europewide on four-door models like the Cayenne SUV or Panamera coupe.
The incentives are among pledges that German automakers made at a meeting last week with political leaders aimed at preventing large-scale limitations to a technology plagued by Volkswagen’s emissions-test rigging and wider air-quality concerns. The manufacturers agreed to update pollution-control software on 5.3 million diesel cars, a project estimated at 500 million euros industrywide, and to take trade-ins of older models that can’t be upgraded.
VW’s sales chief Juergen Stackmann declined during a conference call on Tuesday to specify how much the incentives will cost, beyond saying they’ll involve a “substantial million-euro amount.”
Volkswagen shares declined 0.4 percent to 128.70 euros as of 2.51 pm in Frankfurt, reversing a gain earlier in the day and putting the stock on track for the lowest closing price since December 12.
Fading Market
Demand for cars with diesel
engines is declining in several
European markets as regulators step up scrutiny of emissions rules to improve air quality. Environmental advocacy group Deutsche Umwelthilfe, a fierce critic of diesel cars, won a court case last month seeking broad bans on the models in Stuttgart, the hometown of Mercedes-Benz maker Daimler AG as well as Porsche.
Mercedes has yet to announce terms for trade-ins. BMW AG is offering as much as 2,000 euros if buyers switch from an older diesel car to an electric vehicle.
VW Chief Executive Officer Matthias Mueller confirmed last week that the Wolfsburg-based manufacturer is arranging software fixes for as many as 4 million diesel cars in Germany across all of the group’s nameplates, including about 2.5 million VW-brand cars that were part of a mandatory recall.
The trade-in terms are valid through the end of the year for models meeting Euro 1 to Euro 4 emission standards.