A German court has ruled in favour of allowing major cities to ban diesel cars with heavy pollution rates.
According to Reuters, the move is set to hit the value of 12 million vehicles in Europe's largest car market and probably force carmakers to pay for costly modifications.
The 2015 Volkswagen scandal has been one of the defining contributors to international outrage.
The decision by the court is set to cause damage to both the industry in Germany and the Merkel government, which lobbied heavily against the ban.
Experts have already weighed in, with a report from Euronews revealing fears the problem will only move to another nation.
Air quality analysts believe that many German diesel car owners will opt to sell their cars to neighbouring countries such as Romania or Bulgaria.
Toyota has already stated that it will soon look to cease the sale of diesel cars in Europe.