UPDATE 1-Germany backs away from EU CO2 target for cars

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BRUSSELS, Dec 14 (Reuters) - Germany, a major manufacturer of heavy luxury automobiles, backed away on Friday from a key European Union target for cutting greenhouse gas emissions from cars, part of the bloc's fight against global warming.

A government official told reporters Berlin would not accept the European Commission's proposals to force carmakers to reduce average carbon dioxide (CO2) emissions across the fleet to 130 grams per kilometre from engine technology by 2012.

Germany did support the overall goal of reducing emissions to 120 g/km by 2012 through the inclusion of biofuel use and other measures.

The official said the 130 g/km piece of that target should not be restricted to cleaner engines alone if carmakers could cut emissions more cheaply through improvements in other areas.

"The separation between the 120 grams and the 130 grams is too restrictive," the official said, adding carmakers required more flexibility. Berlin also wanted any fines on manufacturers to allow the possibility of emissions trading among carmakers.

The move by Europe's biggest car-producing nation came less than a week before the EU's executive Commission is to unveil detailed legislative proposals for sharing the burden of emissions cuts and penalties for producers that fail to comply.

It coincides with a U.N. meeting in Bali, Indonesia, where the EU is trying to get the United States and other industrial countries to follow its lead in setting concrete goals for reducing emissions blamed for heating the planet. (Reporting by Carsten Lietz; writing by Paul Taylor and Jeff Mason; editing by Dale Hudson)