U.S., Volkswagen Reach Deal on Emissions Scandal

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The U.S. Justice Department and Volkswagen AG have reached a deal that will see the automaker offer to buy back some of the 600,000 vehicles in the U.S. affected by its long-reaching emissions scandal. Now, more details on that deal have come out of the court hearing in San Francisco.

According to a report from Reuters, U.S. Judge Charles Breyer said the settlement will include a buy-back offer for 482,000 VW Group cars equipped with the 2.0-liter turbodiesel engine. As an alternative, the settlement will also offer owners a possible fix that’s pending approval from regulators and an option to cancel an outstanding lease. An environmental remediation fund to combat excess emissions was also detailed, along with additional “substantial compensation” for owners.

The deadline for a final “consent decree” between the government and VW is June 21. The consent decree will be published for public comment and will need judicial approval before going into effect. Breyer said VW will also put up funds to “promote other green automotive technologies.”

This agreement does not cover the nearly 90,000 vehicles equipped with the 3.0-liter turbodiesel V-6, which Breyer says remain a separate excess emissions issue that he expects to be addressed “expeditiously.”

A VW spokeswoman told Reuters that customers don’t have to take any immediate action. The earliest any buy-backs would take place is likely in July after the settlement is approved. We previously reported that owners would receive an amount in line with their cars’ value before the emissions scandal broke out. There were also reports of a separate compensation fund.

In a statement to Motor Trend, Volkswagen said:

Volkswagen is committed to earning back the trust of its customers, dealers, regulators and the American public. These agreements in principle are an important step on the road to making things right. As noted today in court, customers in the United States do not need to take any action at this time.

To pay for these costs and others associated with the dieselgate scandal, the automaker is rumored to adjust its budget for expenses to more than $10 billion.

Source: Reuters