Sources said owners could either choose to either sell their auto back to the company or get a fix – though that option would harm the vehicle’s performance. It is also the biggest automotive buyback program in US history as well as the costliest scandal in the auto industry.
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US environmental authorities disclosed in September that Volkswagen had manipulated diesel engines to recognize when they were undergoing emissions tests in the laboratory, causing the engines to emit legally allowed levels of toxic nitrogen oxides during tests but exceed those limits in real traffic.
The $10.033 billion is the maximum Volkswagen could pay if it had to buy back all the cars, but the actual amount VW will pay could be significantly less if a large number of owners take buybacks.
Federal court leaders in San Francisco are soon expected to announce the details of Volkswagen’s $14.7 billion settlement of claims related to its emissions-rigging scandal.
Spokeswomen for the US Environmental Protection Agency and Volkswagen declined to comment.
The deal, which will be the largest auto scandal settlement in USA history, sets aside $10 billion to fix or buy back roughly 475,000 polluting Volkswagen vehicles with 2-liter diesel engines. Some owners will get as much as $10,000 in payment, the first sources said, depending on the value of the automobile. Owners would also receive the same compensation if they choose to have the vehicles repaired, assuming USA regulators approve a fix at a later date. The average price of a VW diesel vehicle in August 2015 was about $13,000. The company could start buying back the vehicles as early as this fall.
Volkswagen has agreed to pay $14.7 billion to settle its diesel emissions case. Volkswagen has set aside more than $18 billion to deal with the fallout. This includes Volkswagen paying $2.7 billion in fines and penalties and additional $2 billion on clean-emission technology, according to several sources.
March 29: The U.S. Federal Trade Commission sues Volkswagen, charging the company made false claims in commercials promoting its “Clean Diesel” vehicles as environmentally friendly.
Volkswagen has agreed a $14.7bn (£11.3bn) settlement deal with U.S. regulators after admitting it cheated emission tests. The company still faces additional civil and criminal investigations.
Almost half a million diesel vehicles fall under the terms of the settlement, and $10bn (around £7.5bn) has been put aside by Volkswagen for the objective of buy-backs, fixes and compensation. This is going to be one of the largest consumer class-action settlements ever in the USA history.
In an order sent to the automaker on Monday, the state’s Department of Financial Services also sought information from Volkswagen on insurance coverage that is required for the automaker and Audi cars financed or leased in NY.
The deal for United States owners has led to calls for a similar compensation scheme for Irish motorists.
The German giant subsequently said 11 million cars worldwide were affected.
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The company must address similar charges over its 3.0 liter diesel cars with emissions-cheating devices.
