Menu
Share
Share this story
Close X
 
Switch to Desktop Site

Volkswagen takes 'step on the road to making things right' with DOJ deal

Volkswagen is ready to remunerate US customers who bought a vehicle impacted by the September diesel emissions cheating scandal that impacted millions of car owners worldwide. 

View video

Joyce Ertel Hulbert, owner of a 2015 Volkswagen Golf TDI, holds a sign while interviewed outside of the Phillip Burton Federal Building in San Francisco on Thursday. An agreement will give consumers who bought nearly 600,000 Volkswagen vehicles rigged to cheat on emissions tests the option of having the automaker buy back the cars or fix them, a judge said Thursday.

Jeff Chiu/AP

View photo

The Volkswagen emissions cheating scandal may be coming to a close for customers, as VW and the US Justice Department reached a tentative deal on Thursday.

VW has been in hot water since last fall, when the US Environmental Protection Agency revealed that the company had installed software in its vehicles that allowed it to cheat emissions test standards. Some 11 million vehicles produced with this technology were able to emit up to 40 times the legal limit.

About these ads

The deal will likely include a buyback option for nearly half a million impacted vehicles. An option to fix the problem may be available as well, provided the proposed solution passes regulator scrutiny. For customers who leased compromised vehicles, the leases will most likely be canceled.

"Volkswagen is committed to earning back the trust of its customers, dealers, regulators and the American public," the company said in a statement. "These agreements in principle are an important step on the road to making things right."

More than 600 class action suits were filed against the company.

Although the deal is not final, VW "has reached an agreement on the basic features of a settlement with the class action plaintiffs in the lawsuit in San Francisco," the company said in a statement. "This agreement will be incorporated into a comprehensive settlement in the coming weeks."

US District Judge Charles Breyer called the proposed compensation for customers who bought these vehicles "substantial."

VW not only intends to pay to fix the compromised technology, but it is also willing to buy vehicles back from owners. The settlement is also expected to include an environmental remediations fund to compensate for the excess emissions that resulted from the cheat.

"The agreements in principle are an important step on the road to making things right," VW spokeswoman Jeannine Ginivan said in a statement to Reuters. "Volkswagen intends to compensate its customers fully and to remediate any impact on the environment from excess diesel emissions."

About these ads

Owners of impacted VW models have up to two years to decide what to do with their vehicles. If they decide to sell, they will be offered what the car would have been worth prior to the scandal.

This particular settlement does not apply to the nearly 90,000 larger cars and SUVs that were impacted, as the emissions issues were different for each group.

The company could spend up to $10 million dollars responding to this scandal.

Yet although this prospective deal may settle the score between Volkswagen and its customers, or at least begin to make things right, things are not over between Volkswagen and the Justice Department.

Justice Department investigations into VW's conduct are ongoing.

The settlement announced today is not final, and Judge Breyer has placed a gag order preventing all parties from disclosing further information until the suit is concluded.

The earliest that buybacks will begin is July, according to Ms. Ginivan.

This report includes material from Reuters.