Volkswagen sees hardware fixes for older diesels as infeasible - source

HAMBURG (Reuters) - Volkswagen believes a hardware retrofit of older diesel cars is not feasible in the near term, a source at the carmaker said on Monday, ahead of a German coalition committee meeting on the matter.

The person, speaking on condition of anonymity, said that suppliers were unwilling to assume liability, and that car manufacturers also rejected guarantees for hardware changes.

The positioning comes as the German government and carmakers try to agree on a deal to avert court bans on older diesel vehicles from city streets to improve air quality.

Leaders and senior members of the parties in Chancellor Angela Merkel's ruling coalition of conservatives and centre-left Social Democrats meet later on Monday to discuss the issue.

A spokesman for Volkswagen said that the company was prepared to compromise.

"Basically, we're interested in meaningful solutions that help prevent bans in cities," said the spokesman. "We'll consider the contribution we can make in due course."

Merkel's government has been split on how best to tackle the problem. Transport Minister Andreas Scheuer has sided with carmakers in calling for incentives to encourage owners of older models to trade them in for newer, cleaner ones.

Environment Minister Svenja Schulze has, meanwhile, called for hardware retrofits on older models - an option that the industry says is only feasible in some cases but which would hit fuel consumption and performance in others.

(Reporting by Jan C. Schwartz; Writing by Tom Sims; Editing by Maria Sheahan and Michelle Martin)