EU to probe BMW electric car aid, Volkswagen grant

Reuters (Brussels) - EU regulators are to investigate whether public support for German automaker BMW's 368 million euro ($526.4 million) project to make electric cars violates state aid rules.

German authorities plan to grant 46 million euros for the project at BMW's plant in Leipzig.

"The (European) Commission acknowledges the importance of the project from the environmental and energy policy point of view, but has to assess its compliance with the ... EU provisions for large investment projects," the EU regulator said in a statement on Wednesday.

Separately, the Commission said it would also probe 83.7 million euros contributed by German authorities to Volkswagen's 700 million euro project for small- and medium-sized cars in Zwickau, Saxony, because of the company's market share.

"The Commission has doubts whether Germany's suggestions for the definition of the relevant market... can be accepted," the regulator said.