FRANKFURT -- The emergence of the Greens as likely powerbrokers in a future German government coalition could spell bad news for the country's car and coal power industries.
Following Sunday's general election, Chancellor Angela Merkel's coalition partner, the Social Democrats (SPD), said it would go into opposition, meaning the Christian Democrats (CDU) may now seek a deal with the business-friendly Free Democrats and the pro-enviroment Greens.
Talks on such a coalition would be highly complex, but could see the Greens pressing their key policies on the energy and auto sectors, which are already grappling with Germany's shift away from nuclear power and a diesel emissions scandal.
Among their policies, the Greens want to ban the sale of new combustion-engine cars starting in 2030 - a decade earlier than plans already outlined in France and Britain - to cut pollution levels as the sector moves towards electric vehicles.
They also want a quick phase-out of coal power plants - including lignite plants, the most polluting form of power, which account for 23 percent of Germany's gross power production - and their complete closure by 2030.
Analysts say the Greens would be more likely to have an impact on the coal issue than on cars. As Germany's biggest exporter and employer of more than 800,000 people, the auto industry is too important to the overall economy for any such demands to be fully met, they say.
"With regard to the diesel question the FDP and CDU and even parts of the Greens will be opposed to severe intervention," said Hanns Koenig of Aurora Energy Research, a Britain-based consultancy to utilities, investors and political decision-makers. "With coal, the situation is different and there is much that speaks in favor of a Green position."
Analysts at Jefferies were skeptical coal plants could be phased out as quickly as desired by the Greens, saying the 2030 deadline would withdraw capacity currently providing about half of the country's total electricity generation.
"Even if we assume that half of the market share gap is filled by the existing gas capacity in such a scenario, Germany will have to build an additional 130 GW of renewables to balance the market," they wrote in a research note. "We struggle to add the maths in such a scenario."
VW CEO 'shock'
Separately, Volkswagen Group CEO Matthias Mueller, spoke of his shock that the "populist, right-wing, xenophobic" Alternative for Germany (AfD) party scored so highly in the election. "Germany has been politically and economically successful because we are a tolerant, cosmopolitan and internationally-minded country," Mueller said in a statement. "This is something we must keep on fighting for."
AfD is now the German parliament's third-largest party.
Bloomberg contributed to this report