Frankfurt Auto Show

Frankfurt Auto Show has been opened to public by German Chancellor Angela Merkel on Thursday with a speech defending the government's car scrapping scheme, its decision on Opel's sale and looking to the future of transportation with electric and hybrid cars.



"Electro-mobility, electric and hybrid cars, are very much the window of the future," she said in her opening speech. "But one can't hold their breath for electric cars now."

Merkel said the current estimate is to have about 1 million electric cars on the road by 2020, so "it would really take another generation of car buyers" before the trend is widespread in Germany.

Earlier this year, Merkel's government backed a series of financial incentives for electric cars that is to start in 2012.

Merkel defended the government's stance on German carmaker Opel, in which Canadian car parts maker Magna International Inc. and Russian lender Sperbank will take over a 55 percent stake -- a solution the government had long lobbied for.

The government -- which is providing some euro6 billion (nearly $9 billion) in bridge financing and loan guarantees to the new company -- was criticized for not considering other bidders.

The U.S. federal government also provided large amounts of capital to the former Opel parent General Motors Co., which will retain a stake in Opel.

"We thought it was important to give this company another chance," she said.

Merkel also said Germany's car scrapping bonus had done a lot to help the German economy in the difficult times over the last year.

She said 2 million Germans had taken advantage of the program in which they received euro2,500 toward a new car from the government if they traded in a car that was at least nine years old. The government allotted euro5 billion to the program and funding ran out earlier this month. There are no plans to renew it.

"We believe this bonus helped build a bridge to auto workers," Merkel said. "That we will sell less cars next year is obvious, but we think exports will pick up by then."

The program was partly intended to put more efficient cars on the road and make a positive contribution to the environment.

The auto show is open to the public from Thursday until September 27.