Volkswagen is still committed to selling diesel vehicles for the time being, and in order to stave off potential diesel bans across its home country, it's using incentives to entice diesel owners to swap into something much newer.
Volkswagen announced that it will offer owners of older diesel vehicles multiple incentives to trade in their vehicles for new or lightly used Volkswagen vehicles. The diesel vehicles eligible for this scheme fall under outdated European emissions standards, from Euro 1 (instituted in 1992) to Euro 4 (2005).
Owners across Germany are eligible for an environmental incentive between 1,500 and 8,000 euros (about $1,700 and $9,200), depending on the size of the vehicle being purchased. Volkswagen notes that the full incentive only applies to two groups: Germans in any part of the country buying new VW diesels to replace their old ones, and Germans in the 14 most heavily polluted cities purchasing a new car with any kind of powertrain.
A partial version of the incentive applies to Germans buying lightly used cars, as well. The incentive runs between 50 and 75 percent of the full-bore one mentioned above, with the reduction depending on the vehicle's size. Lightly used vehicles have no limitations as far as powertrain is concerned, whether the buyer lives in one of those 14 cities or not.
There's also an exchange premium that boosts the trade-in value of a qualifying Euro 4 or Euro 5 diesel, adding between 500 and 7,000 euros, determined by the size of the new vehicle being purchased. This is only available to Germans living in the 14 most polluted cities in the country, though. The German federal motor authority will send mailers to eligible citizens about these incentives.
Not only is this good for the environment, it's good for Volkswagen, which could suffer if diesel bans were enacted in any German cities. Having fewer of the dirtiest diesels on the road could help avert such a ban, and diesels still sell in impressive volumes in Europe. If a ban does show up, buyers of new diesel VWs are covered -- the automaker has a guarantee in Germany that will let owners exchange their new diesel vehicle for something different if their cities impose diesel bans.
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