in Berlin. The industry is under huge pressure to help curb air pollution, after the diesel emissions scandal, which exposed cheating to manipulate test readings.
The reputation of a key strategic industry is at stake. Car firms provide more than 800,000 jobs in Germany.
Firms including VW and Opel are likely to offer software updates for engines.
But agreement on a much more expensive fix - retrofitting diesel engines with new components - is unlikely, correspondents say.
The software updates, for about two million cars, will cost about €300m (£268m; $355m). The aim is to make older cars compliant with EU air quality standards, to cut the amount of toxic nitrogen oxide (NOx) they emit.
The pressure increased last week, when a court in Stuttgart upheld a proposal to ban older diesel cars from the city.
It is the home city of Mercedes and Porsche, and one of Germany's pollution hotspots.
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The BBC's Jenny Hill in Berlin says air pollution now regularly exceeds legal limits in many German cities. It is a headache for the mighty automotive industry and for German politicians, ahead of a 24 September general election.
But Germany is unlikely to commit to ending production of combustion engine vehicles any time soon, our correspondent says.
Concern about air pollution in cities and the impact of CO2 emissions on the climate has put governments and manufacturers under pressure to clean up the industry.
France and the UK plan to ban sales of fossil-fuel vehicles from 2040.
But switching to a future of electric vehicles will be hugely expensive - not least because of the need for charging points everywhere.
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