Royal Says France Weighing the End of Diesel Fuel Tax Advantage

French Environment Minister Segolene Royal said carmakers must prepare for the day when diesel no longer is used to power vehicles and that the government is considering ending its tax advantage compared to other types of fuel.

"It’s obvious that it’s necessary to prepare the end of diesel," she said during an interview with France 5 television station.

France is among countries investigating whether Volkswagen AG deceived customers about the emissions levels of its diesel cars, which may lead to fines on the German automaker. About 59 percent of newly registered vehicles in France last year were diesel, making the country one of the biggest users in Europe. Even so, the fuel was facing rising opposition even before the Volkswagen scandal as environmentalists and officials in Paris blame it for chronic smog in the capital.

Diesel fuel’s tax advantage must be ended over five years and more significant bonuses are needed to encourage the purchase of clean cars and help manufacturers prepare for post-diesel automobile production, Royal said.

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