German government reaches deal to clean up dirty diesel cars

[BERLIN] Germany's ruling coalition reached a deal to clean up the emissions of older diesel vehicles to avoid driving bans in polluted urban areas.

The plan, which will require support from Volkswagen, Daimler and BMW to be implemented, was agreed by Chancellor Angela Merkel's government after a meeting that ended in the early hours of Tuesday morning. Details will be announced at a press conference later.

The deal represents the second attempt at defusing the country's diesel crisis. Actions undertaken last year, including software upgrades for emissions systems, proved insufficient to improve air quality.

The government has been under increasing pressure to find a solution with cities such as Frankfurt and Stuttgart poised to join Hamburg in barring diesel vehicles from certain areas because of excessive levels of smog-causing nitrogen oxides. The ongoing debate has sapped demand for the technology and sullied Germany's reputation as an automotive leader.

BLOOMBERG