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Volkswagen CEO predicts 'renaissance' for embattled diesel cars

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"Diesel will see a renaissance in the not-too-distant future because people who drove diesels will realise that it was a very comfortable drive concept," chief executive officer Matthias Mueller told journalists Monday at the Geneva International Motor Show. "Once the knowledge that diesels are eco-friendly firms up in people's minds, then for me there's no reason not to buy one."

[MUNICH] Volkswagen, whose global emissions-cheating scandal has put the future of diesel engines in doubt, expects consumers to return to the embattled technology - and soon.

"Diesel will see a renaissance in the not-too-distant future because people who drove diesels will realise that it was a very comfortable drive concept," chief executive officer Matthias Mueller told journalists Monday at the Geneva International Motor Show. "Once the knowledge that diesels are eco-friendly firms up in people's minds, then for me there's no reason not to buy one."

Mr Mueller's comments are bold considering that Volkswagen has put aside about US$30 billion in provisions to cover fines, retrofits and legal costs stemming from the company using diesel-emissions systems that duped governments running car-pollution tests.

Germany is now considering potential bans of diesel vehicles from cities and governments including China, France and the UK have put in place plans to phase out the internal combustion engine.

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German carmakers want to stick with diesel, which they contend is the best way to meet regulatory demands in the European Union to cut output of the greenhouse gas carbon dioxide until demand for zero-emissions electric cars takes off.

Other companies are abandoning the technology: Toyota Motor is getting rid of diesel versions of its cars this year, offering only two hybrids and one turbocharged gasoline engine in its redesigned Auris model.

Tougher Target

Carmakers in the EU need to lower fleet emissions to average 95 grams of CO2 per kilometre by 2021. Meeting those goals has gotten tougher as demand for diesel cars - which emit about a fifth less CO2 compared to equivalent gasoline vehicles - has slumped amid consumer worries about city center driving bans. Daimler, the maker of Mercedes-Benz luxury vehicles, has said its CO2 fleet emissions rose last year, as buyers opted for larger cars.

While diesel's market share has been dropping in Europe as buyers switch to other powertrains, primarily gasoline, Mr Mueller is predicting a comeback.

"The rules of the game in the EU in relation to climate protection and emissions goals on CO2 are so challenging that governments cannot do without diesel," he said.

VW's Pledge Volkswagen pledged last year to spend more than 34 billion euros (S$55.33 billion) through 2022 to develop battery-power and autonomous-driving technology, and it has plans to create electric versions of all 300 cars, trucks and buses sold by its dozen brands by the end of the next decade.

"We need diesel to get to the CO2 goals," Herbert Diess, who heads Volkswagen's namesake mass-market brand, said after presenting the all-electric ID Vizzion concept car that's capable of driving as far as 650 kilometres on a single charge. "Electric vehicles in many cases won't keep frequent drivers happy."

Volkswagen won't miss the targets the EU has set, Mr Mueller told reporters.

"We're doing everything to avoid" coming up short, he said. "If there's less diesel, then getting to that goal just gets tougher."

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