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1ST LEAD Trade-in deals, engine upgrades to keep diesel cars on German streets By Sascha Meyer and Andreas Hoenig, dpa

Berlin (dpa) - Faced with serious air pollution and potential bans on diesel cars in some city centres, the German coalition government has hammered out an agreement involving trade-in deals and engine upgrades for dirtier cars in order to keep private cars on the roads.Germany‘s reputation for producing high-quality cars has taken a knock after manufacturers admitted falsifying the true emissions values of their vehicles; the situation has been exacerbated after dozens of German cities breached EU rules for air quality.The government was forced to act after cities proposed banning diesel vehicles from their city centres to clean up the air, causing an uproar among diesel-vehicle owners.Tuesday‘s deal focuses on 14 of the most polluted cities, including Munich, Stuttgart, Cologne, Hamburg and Dusseldorf. Carmakers have promised the government they will offer "an exchange programme with attractive switch premiums or discounts" for car owners wishing to trade in their older Euro 4 and Euro 5 cars for new ones, although no figures have been named so far.Euro 4 and 5 refer to European emissions standards.The plan aims to balance out "the particular loss of value that diesel vehicles have suffered as a result of the debate about their emissions," Tuesday‘s agreement said.For cars meeting Euro 5 standards, the government would like owners to have the choice of an engine upgrade, with the expectation that manufacturers will cover the cost of installing new emissions-cleaning technology.The car industry has so far been unwilling to accept these costs, and Opel went so far as to flat out refuse on Tuesday, saying the plan was "economically not sensible and technologically not mature."Volkswagen said on Tuesday it wanted time to examine the coalition deal before making a statement."We want to prevent driving bans and, where they are unavoidable, avoid disadvantages for citizens who depend on individual mobility," the decision paper said. "This applies to both financial burdens and usage restrictions. The automotive industry also has a great responsibility."After a summit between the federal government and the car industry in 2017, manufacturers offered trade-in deals worth up to 10,000 euros (11,530 dollars) per car. More than 200,000 car owners took up the offer, they said back in July. The government said this was not enough.

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