Volkswagen to settle US$15 Billion for Emissions Issues

After admitting last year to installing "defeat devices" in 475,000 of its diesel cars, Volkswagen has agreed to pay up to $15 billion to settle claims that it intentionally misled regulators and consumers, an attorney for the plaintiffs in the case announced this morning. Affected owners will have the choice of having Volkswagen repair or buy back the polluting vehicle and owners of the affected vehicles can expect to receive $5,100 to $10,000 in cash compensation



The fixes offered to Volkwagen owners are designed to lower emissions but are expected to compromise the performance of the car. The company could start buying back the vehicles as early as this fall.

The Department of Justice, the Environmental Protection Agency and the Federal Trade Commission will make an announcement this morning at 9:30 a.m. in Washington, D.C., which they are calling “significant environmental and consumer relief.”

The lead attorney for the plantiffs said the German automaker will put $2.7 billion into a trust to fund environmental remediation and commit another $2 billion to promote “Zero Emissions Vehicle technology.”

“This historic agreement holds Volkswagen accountable for its betrayal of consumer trust, and requires Volkswagen to repair the environmental damage it caused,” said lead-counsel Elizabeth Cabraser, chair of the 21 member Plaintiffs’ Steering Committee (PSC), which negotiated the settlement on behalf of class members.

“To achieve relief for consumers so swiftly on such a large scale is unprecedented,” she added.

If the settlement is approved by Judge Charles M. Breyer, it would be the largest consumer auto industry class action settlement in U.S. history.

The scandal came to light last September when Volkswagen admitted that some of its diesel vehicles used illegal “defeat device” software. Regulators said Volkswagen’s diesel cars emitted nitrogen oxides, or NOx, at 10 to 40 times the federal limit.

Volkswagen equipped certain 2.0 liter vehicles with software that detected when the car was being tested for EPA compliance, thus producing emissions that were different from actual on-the-road emissions.

The Justice Department also said Volkswagen violated EPA regulations by applying for certification with certain vehicle designs but then importing vehicles with different designs.

The affected vehicles are: 2009-14 Volkswagen Jetta SportWagen TDI, 2009-15 Volkswagen Jetta TDI, 2010-15 Audi A3 TDI, 2010-15 Volkswagen Golf TDI, 2012-15 Volkswagen Beetle TDI, 2012-15 Volkswagen Beetle Convertible TDI, 2012-15 Volkswagen Passat TDI and the 2015 Volkswagen Golf SportWagen TDI.

Source: ABC NEWS


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