The payback would include cash payments, buying back vehicles, and more.
Volkswagen has agreed to pay $1.208 billion to dealers in the United States as a settlement over the costs from the diesel emissions scandal. The lawyers representing the showrooms also consent to the deal. The United States District Court for the Northern District of California still needs to grant final approval before the agreement is final, though.
According to Automotive News, the VW brand has 652 dealers in the U.S, which averages out to $1.85 million for each showroom from this agreement. The settlement payment will happen over the next 18 months and will partially include a cash incentive. The automaker will also buy back unsold diesel vehicles and will no longer require certain improvements at the stores.
VW came to an “agreement in principle” with dealers in August, but neither side revealed specifics about the settlement at that time. The showrooms first filed their lawsuit in April because they were no longer able to sell diesel vehicles and because the bad press from the scandal hurt business. Through September, VW moved 231,268 vehicles in the U.S in 2016 – a drop of 12.47 percent through the same period last year.
VW Group is still working with government regulators to avoid a consumer buyback of 85,000 luxury vehicles with the 3.0-liter diesel V6. According to Automotive News, both sides continue to negotiate "a technical solution that reduces the emissions of these vehicles." An Audi exec previously indicated an agreement about fixing these engines could be ready by late October or early November. The Feds already rejected the company's first proposed fix for this problem because the automaker's proposal was “incomplete and deficient in a number of areas."
The company already reached a roughly $15-billion settlement over the defeat devices on the 2.0-liter four-cylinder diesel. The agreement included a $10-billion provision for buying back the affected vehicles. Automotive News reported that 311,000 of the 475,000 total customers already applied to take part in the campaign. The plan also stipulated $2.7 billion in environmental cleanup and $2 billion for improving EV infrastructure.
Source: Automotive News, Volkswagen