A total of $14.7B will have to be paid by the Volkswagen in regards to the 2.0-liter TDI settlement.
After nearly five months on trial following Volkswagen’s ‘Dieselgate’ scandal, the German automaker has officially obtained final approval by the courts to put the 2.0-liter TDI settlement into effect. Judge Charles R. Breyer of the United States District Court for the Northern District of California, has granted the approval to the private plaintiffs represented by a court-appointed Plaintiffs’ Steering Committee (PSC).
The claim, which affected nearly 500,000 Volkswagen- and Audi-branded TDI diesel vehicles sold to American buyers (of which just 340,000 owners took part in the suit), reached approval today with a record-setting $14.7B settlement, the largest civil settlement ever reached with an automaker.
The company will begin buying back vehicles as early as mid-November, with 900 new employees hired to handle the buybacks specifically. Volkswagen will spend $10.33B of the $14.7B on buybacks alone, and another $4.7B on programs to offset the excess emissions and development of zero-emissions vehicles.
In total, the company has already agreed to spend over $16.5B in connection with the scandal, including $1.21B in payments to 652 U.S. Volkswagen-branded dealers, and $600M to 44 U.S. states to address other claims.
Judge Breyer, who presided over the case, said that the agreement, “adequately and fairly compensates” owners affected by the scandal, and that “given the risks of prolonged litigation, the immediate settlement of this matter is far preferable.”
The settlement, though, does not include the nearly 85,000 3.0-liter V6 diesel vehicles sold in the U.S., to which Volkswagen will have to pay a hefty fine to the U.S. Justice Department for fines violating clear air laws, and lawsuits from at least 16 U.S. states for additional claims.
Volkswagen AG, Volkswagen Group of America, Inc. and certain affiliates (together, Volkswagen) announced today that Judge Charles R. Breyer of the United States District Court for the Northern District of California has granted final approval to the settlement agreement between Volkswagen and private plaintiffs represented by a Court-appointed Plaintiffs’ Steering Committee (PSC) to resolve civil claims regarding eligible Volkswagen and Audi 2.0L TDI vehicles in the United States. Concurrently, Judge Breyer also approved a Consent Decree between Volkswagen and the U.S. Department of Justice on behalf of the Environmental Protection Agency (EPA) and the State of California by and through the California Air Resources Board (CARB) and the California Attorney General; and a Consent Order between Volkswagen and the U.S. Federal Trade Commission. All three agreements were previously announced.
“Final approval of the 2.0L TDI settlement is an important milestone in our journey to making things right in the United States, and we appreciate the efforts of all parties involved in this process. Volkswagen is committed to ensuring that the program is now carried out as seamlessly as possible for our affected customers and has devoted significant resources and personnel to making their experience a positive one,” said Hinrich J. Woebcken, President and CEO of Volkswagen Group of America, Inc.
Volkswagen remains focused on resolving other outstanding issues in the United States and continues to work towards an agreed resolution for customers with affected 3.0L TDI V6 diesel engines.