Volkswagen will pay New Hampshire about $6.1 million to settle Consumer Protection Act violations, up to $29 million in environmental mitigation, and many millions to fix or buy back impacted vehicles.
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The attorneys generals’ investigation confirmed that Volkswagen sold more than 570,000 2.0- and 3.0-liter diesel vehicles in the United States equipped with “defeat device” software meant to cheat emissions tests, and actively concealed the existence of the modification from regulators and the public. On top of the settlement with each owner, Volkswagen will also offer to either buy back the vehicle or fix the engine.
The settlement would resolve lawsuits brought by Volkswagen customers who bought what were touted as “clean” and efficient diesel cars, only to learn that their vehicles were putting out pollution at many times the levels allowed under US regulations.
On top of compensation to individual owners, Volkswagen will be required to contribute $2.7 billion to a fund to undo environmental damage caused by the cheating vehicles and $2 billion to developing zero-emission vehicle technology.
If the settlement is approved by Judge Charles M. Breyer, it would be the largest consumer auto industry class action settlement in USA history.
The settlement, which must be approved by a federal judge in San Francisco who is overseeing the litigation, could affect some 480,000 owners of Volkswagens and Audis with 2.0-liter diesel engines.
Massachusetts Attorney General Maura Healey announced Tuesday morning, the state would receive part of a $570 million settlement paid to several states.
Under the agreement, Volkswagen will likely have to scrap thousands of cars. Vehicles with 3.0-liter engines are not covered, although the settlement does not diminish any legal rights owners of those vehicles may have.
On July 26, 2016, the settlement website will allow class members to enter their Vehicle Identification Number or VIN and mileage to see the expected vehicle value and restitution payment for their vehicle, based on its model year, trim line, actual equipment and options.
Consumers who choose the buyback program will receive a payment equal to the September 2015 National Automobile Dealers Association Clean Trade-in value of the auto before the emissions scandal became public.
“Today’s settlement is not only a victory for American consumers but hopefully it will serve as a deterrent to those who seek to intentionally deceive the public”. VW must also offer to forgive any loans for owners who owe more on their cars than the pre-September values. Volkswagen’s advertising and marketing materials falsely represented the cars as environmentally friendly or “green” in spite of its knowledge that the vehicles emitted harmful oxides of nitrogen (NOx) at rates many times higher than the law permitted.
“At this moment, I don’t know anything more than I did a couple of months ago”, he said.
The scandal erupted in September when it was learned that the German automaker had fitted many of its cars with software to fool emissions tests and had put dirty vehicles on the road. The EPA has since changed its testing to include on-road exhaust pipe checks.
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The company has already earmarked £12.7 billion to cover recalls and other costs for 11 million cars sold with the software globally.
