In the second large consumer settlement related to its diesel emissions scandal, Volkswagen says it will pay around $1.2 billion to help people who bought its vehicles with the larger 3.0-liter diesel engine. The plan includes a buyback as well as a repair program.
The settlement could be approved by May, after hearings this month. The plan would cover nearly 80,000 Volkswagen, Audi and Porsche vehicles that contain what U.S. regulators have called a cheating mechanism, which misreports the amount of toxins the cars normally emit during emissions testing.
All of the vehicle owners in question would get cash payments. Reporting from Berlin, NPR's Soraya Sarhaddi Nelson says those "who opt for fixes will get between $7,000 and $16,000 as well as an additional $500 if the fix hurts their car's performance." Owners who participate in a buyback will get $7,500 on top of their vehicle's value, Soraya says.
Terms of the settlement are different for two generations of the diesel engines, with the first group in the 2009-2012 model years and the second group in the 2013-2016 models. Owners of around 58,000 newer vehicles would be eligible for a free recall and repair program, VW says. People who own the roughly 20,000 older cars could either have them bought back or modified to "substantially reduce" their nitrogen oxide emissions, the company says.
The models range from the VW Touareg to the Audi Q7 and the Porsche Cayenne Diesel.
The proposed deal is the latest large settlement in the emissions scandal:
- In January, Volkswagen agreed to pay $4.3 billion to settle civil and criminal allegations involving some 590,000 vehicles in the U.S.
- Last October, a judge approved a $14.7 billion deal that included around $10 billion in payments to owners of some 500,000 vehicles with 2.0-liter diesel engines.
- Last August, VW announced a deal to compensate 652 franchise dealers in the U.S., reportedly worth $1.2 billion.
- Payments have also included billions of dollars in environmental reparations, including $4.7 billion administered by the EPA.
If the new plan gets court approval, all of Volkswagen's U.S. customers who were affected by the emissions scandal would be accounted for, says Hinrich J. Woebcken, the company's president of American operations. Today, he said the carmaker will "continue to work to earn back the trust of all our stakeholders and thank our customers and dealers for their continued patience as this process moves forward."