FILE PHOTO: Innogy SE board members Hans Buenting, COO Renewables, Hildegard Mueller, COO Grid and Infrastructure, CEO Uwe Tigges and Martin Herrmann, COO Retail, attend the company's annual general shareholders meeting in Essen, Germany April 24, 2018. REUTERS/Wolfgang Rattay/File Photo

FRANKFURT (Reuters) - The German carmakers lobby VDA is set to appoint conservative politician and former Innogy IGY.DE board member Hildegard Mueller as president, Berlin daily newspaper Der Tagesspiegel reported on Wednesday, citing sources.

Frontrunner Mueller was currently meeting VDA board members, ahead of her likely nomination to succeed Bernhard Mattes, Tagesspiegel said, adding the nomination was expected by the end of the month.

Another potential candidate, European Union budget commissioner Guenther Oettinger, had only an outside chance, the paper said.

Mattes retires at the end of the year.

The industry faces fundamental changes with tougher emissions rules and the shift to electric vehicles.

Environmental activists have accused the industry of failing to do enough to help avert a climate crisis.

Mueller, a former conservative member of parliament and CDU party official, has not worked in the car industry but is said to be close to Chancellor Angela Merkel for whom she served as a minister of state at the Chancellery between 2005 and 2008.

She is also very close to the energy sector, having run BDEW, the Berlin-based utility industry association, between 2008 and 2016 as a managing director.

This was prior to joining Innogy where she was responsible for grids and infrastructure. That role could help her in the field of electric cars which depend on power grids for charging.