By Andreas Cremer and Ilona Wissenbach

NUERBURGRING, Germany (Reuters) - Porsche will decide at the end of the decade whether its latest generation of diesel engines will be its last, Chief Executive Oliver Blume told Reuters, the first time a German carmaker has said in public it could discontinue diesel.

Volkswagen's <VOWG_p.DE> cheating on diesel emissions tests has cast a shadow over its Porsche division and the sports car brand, which first introduced diesel in its Cayenne sports utility vehicle (SUV) in 2009, is considering its options.

"Of course we are looking into this issue," CEO Blume said in an interview at the Nuerburgring motorsports complex in western Germany. "We have not made a decision on it."

Blume said Porsche would offer a mix of combustion engines, plug-in hybrid vehicles and purely battery-powered cars over the next 10-15 years and would decide at the end of the decade whether diesel had a future at Porsche.

German prosecutors last month started investigating Porsche staff to see whether they were involved in designing illicit engine-control software and regulators are examining whether the Cayenne was fitted with such a device.

A redesign of the Cayenne will be launched in September and it will still offer a diesel version, Blume said, just like the Panamera saloon that hit dealerships last November.

"For the generations that will follow there are different scenarios," Blume said. One scenario has Porsche backing out of diesel altogether, sources at the carmaker said.

Stuttgart-based Porsche still relies on diesels, which account for about 15 percent of its global sales, to help it bring down emissions of carbon dioxide (CO2) as they are more fuel-efficient than petrol engines.

At luxury rival BMW <BMWG.DE>, diesel cars make up 35 percent of new registrations while Audi's <NSUG.DE> European diesel sales alone account for two-thirds of deliveries.

ELECTRIC CITIES

But diesel's image has been badly tarnished by the emissions scandal and revelations that some engines pump dangerously high levels of poisonous nitrogen oxides into the air, prompting many carmakers to review their strategies.

To tap into growing demand for electric cars, Porsche is spending a billion euros ($1.2 billion) to overhaul its main Stuttgart plant and build its first battery-only model - the four-door Mission E saloon which is due on the market in 2019.

Battery-only vehicles could account for a quarter of Porsche's sales by 2025, give or take 5 to 10 percentage points, Blume said, contradicting a media report that said up to half of its output by 2023-24 could be electric.