German Auto Stocks Reaction To Merkel Criticism Signals Relief Rather Than Fear – Forbes
German auto stock prices showed a mixed reaction to Chancellor Angela Merkel’s election campaign criticism of the industry’s diesel shenanigans and the betrayal of trust it represented by its leaders.
The industry is also under pressure because of a cartel investigation, while VW’s protected political status is under attack.
In early trading Monday, Volkswagen shares rose 1.2%, and BMW edged 0.8% higher. Mercedes parent Daimler declined 1.1%.
Merkel, leader of the right of centre Christian Democratic Union (CDU) and strongly favored by opinion polls to return to office after the election September 24, held back from urging more action that might penalize diesel engines, which form a big part of the industry’s strategy to meet tough fuel consumption rules which kick in by 2020.
Merkel’s main opposition, the left of centre Social Democratic Party (SPD), also joined in the criticism of the auto industry. SPD leader Martin Schulz said the industry hadn’t planned seriously for the future, but made no concrete proposals
Merkel also held back from imposing a quota for electric car sales. Earlier this year Merkel withdrew an ambitious but failing ambition to have 1 million electric cars on German roads by 2020.
According to Reuters, the Emnid poll for Sunday’s Bild am Sonntag weekly newspaper showed support for Merkel’s conservative coalition at 38% and the SPD at 24%.