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BERLIN (Reuters) - Germany's would-be coalition partners said in a draft paper drawn up by a working group that Germany needed cleaner, more efficient combustion engines, including possible hardware modifications, to protect the climate and preserve clean air.

A big challenge in talks between Chancellor Angela Merkel's conservatives and the centre-left Social Democrats (SPD) is to find a way to mend the battered reputation of Germany's mighty car industry after a diesel scandal and meet climate targets.

This would require a range of measures, including support for electric vehicles and "more efficient and cleaner combustion engines including refits" said the paper. Hardware improvements to engines are significantly more costly than the software upgrades already agreed with the industry.

(Reporting by Markus Wacket; Writing by Madeline Chambers, editing by Thomas Escritt)

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