German Cities Win the Right to Ban Cars

Gasoline and diesel-burning vehicles might be banned in the hometowns of Mercedes Benz and BMW.

Germany’s Federal Administrative Court ruled that the city of Stuttgart; location of Daimler A.G.’s (OTC: DDAIF) headquarters, has the right to ban polluting vehicles from its streets, The New York Times reported on 27 February 2018. Also winning that right would presumably be Munich where BMW (OTC: BMWY) is headquartered.

The court ruled that German cities can bar vehicles that violate European Union air-pollution standards from the streets. Several German cities want to move against diesel because it is the main cause of air pollution in Europe.

Air pollution in many European cities is worse than in the U.S. because diesel-burning passenger cars and light trucks are far more common on the continent. One in three cars in Germany burns diesel, The New York Times reported.

Will Germany Dump Diesel

Diesel’s credibility in Germany is at an all-time low thanks to the Volkswagen (OTC: VLKAY) diesel scandal.

The first diesel bans might come as early as this fall, The Times reported. A German environmental group called the Deutsche Umwelthilfe brought the lawsuit after the nation’s federal government refused to take action against Diesel.

The first bans will be enacted in the most polluted German cities including Dusseldorf and Stuttgart. Details of the bans are not available but they might be similar to that in Paris.

Diesel vehicles built before 2014 and petrol burners built before 1997 are banned from the French capitol. The French government has long-term plans to phase out all internal combustion vehicles by 2040.

It is not clear if the Federal Administrative Court ruling is a precedent that will be followed in the United States. The ruling is likely to influence other courts in the European Union, and will undoubtedly be cited by local governments and environmental groups in litigation designed to limit diesel use in the United States.

German Automakers prepare for the Post Diesel World

One group that sees the writing on the wall is German automakers; BMW, Daimler, and Volkswagen all have elaborate plans to go electric.

Volkswagen has plans to spend €20 billion ($24.80 billion) on its Roadmap E electric-vehicle technology plan by 2024. That includes the investment of €20 billion ($24.80 billion) on electric-vehicle technology over the next five years. It also includes plans for at least two battery factories in Europe that might rival Tesla Motors (NASDAQ: TSLA) Gigafactory in size and scope.

Volkswagen apparently believes diesel trucks will be banned next and so does Daimler. Daimler AG (OTC: DDAIF) is building an electric light ruck for urban use called the Fuso eCanter. Volkswagen is planning an electric-powered version of its Crafter work van – the eCrafter.

It looks as if the post-diesel world has arrived. The post-gasoline world might not be far behind -so sell your oil stocks now. It might also be a good time to invest in lithium because most of today’s electric vehicles use lithium-ion batteries.

 

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