By Barbara Lewis
BRUSSELS (Reuters) - European lawmakers on Wednesday backed a compromise deal to reduce car emissions that will still allow vehicles to exceed official pollution limits, defying calls for more radical reform following Volkswagen's emissions-test cheating scandal.
The vote, which narrowly rejected a proposal to block the compromise, had been scheduled for January, but was delayed by bitter arguments between members of the European Parliament and fierce lobbying.
Volkswagen's <VOWG_p.DE> admission in September that it cheated U.S. diesel emissions tests created a political storm in Europe where around half of vehicles are diesel.
Diesel is particularly associated with emissions of nitrogen oxide linked to lung disease and premature deaths.
The European Commission, the EU executive, had already begun trying to close a known gap between laboratory testing of new vehicles and the real world, where toxic emissions have surged to more than seven times official limits.
However, the European Automobile Manufacturers' Association (ACEA) said in a position paper seen by Reuters that the Commission's reform plans were too challenging for current diesel models and could threaten the technology as a whole, jeopardizing jobs across the region.
At a closed-door meeting in October, EU member states agreed a compromise -- now backed by the European Parliament -- that would cut emissions but still allow a 50 percent overshoot of the legal ceiling for nitrogen oxide of 80 milligrams/kilometer.
Mayors from cities including Copenhagen, Paris, Madrid, Milan and Naples had urged the European Parliament, meeting in Strasbourg, to reject the plan.
"If such a decision would be confirmed, we fear that our commitment to reduce air pollution in cities will become meaningless," a letter from eight city mayors to members of parliament said.
Green lawmakers and liberals also pressed for a rejection, saying the compromise was an illegal weakening of already agreed limits.
"Unfortunately, clean air, fair competition and the rule of law did not get a majority today," Dutch Liberal politician Gerben-Jan Gerbrandy said.
But the dominant center right grouping, the European People's Party (EPP), backed the compromise
It said rejecting the plan would delay a reduction in vehicle emissions, as a new proposal would have to be agreed and the car industry would lack regulatory certainty to invest in cleaner technology.
The European Commission welcomed Wednesday's vote as a step in the right direction and urged manufacturers to start designing vehicles "for full compliance with the legal emissions limit" when measured in real driving conditions.
(Editing by Mark Potter)