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Category: Air Pollution / Automotive

VW to pay over $13 billion for emissions cheating scandal: sources

Friday, 24 Jun 2016 08:57:30

Volkswagen declined to comment on the reports. (7.30)

The Volkswagen Group will pay more than $US10 billion ($13.3 billion) to settle claims by nearly 500,000 owners stemming from its US diesel emissions cheating scandal and fund efforts to offset pollution, three sources briefed on the agreement say.

Key points:

  • Owners will receive over $5,000 along with an estimated value of the vehicle
  • VW will introduce a program to offset pollution as part of the settlement
  • VW is not expected to be allowed to resell repurchased vehicles

Speaking on condition of anonymity, due to court-imposed gag rules, a source said owners will receive an average of $US5,000 ($6,633) in compensation along with the estimated value of the vehicles as of September 2015, before the scandal erupted.

Owners would also receive the compensation if they choose to have the vehicles repaired, assuming US regulators approve a fix at a later date.

As part of the settlements, Volkswagen will help boost zero emissions vehicles and introduce a program to offset excess diesel pollution from the offending vehicles.

The settlement is valued at $US10.3 billion in documents outlining some of the complex settlements, the source added.

Another source said that figure does not include part of the environmental costs, which will raise the overall settlement total — the source would not disclose the overall total.

Volkswagen and the US Environmental Protection Agency declined to comment.

In September, VW disclosed that it had used sophisticated software to evade emissions requirements in nearly 11 million vehicles worldwide.

It also misled the EPA, which had started asking questions in 2014.

The company's chief executive officer Martin Winterkorn resigned in the wake of the scandal.

The settlement is expected to be complex, requiring owners to fill out detailed worksheets about their vehicle to calculate the buyback value.

Reuters reported in April that owners may have two years before having to decide whether to sell back vehicles.

VW is not expected to be allowed to resell or export repurchased vehicles, unless they convince regulators they can be fixed, sources said.

Former owners of the polluting vehicles will also be eligible for compensation — although less than current owners, sources said.

Reuters

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