Exact terms are still confidential until September.
Volkswagen Group of America has come to an “agreement in principle” with its dealer body about reimbursing them over the diesel emissions scandal. Though the exact terms haven’t been announced, Volkswagen says it has agreed to “make cash payments” and give other benefits to dealers whose franchise values have been hurt by the scandal.
A group of Volkswagen dealers first filed suit against the automaker in April, and in July dealers told reporters that a senior executive had promised “fair restitution” for any lost sales or revenue. VW dealers were unable to sell certain TDI diesel models because they had an illegal “cheat” device intended to evade EPA emissions testing; negative publicity around the scandal may have also discouraged shoppers from buying other types of Volkswagen cars.
The agreement is still being finalized and exact details, if approved by the U.S. District Court for the Northern District of California, are expected be announced in September. VW says it is still determining, for instance, “how to apportion payments to dealers in the appropriate manner.”
“We believe this agreement in principle with Volkswagen dealers is a very important step in our commitment to making things right for all our stakeholders in the United States,” Hinrich J. Woebckn, chairmain of Volkswagen Group of America, said in a statement.
For owners of affected models with 2.0-liter turbodiesel engines, Volkswagen has already announced a plan to buy back cars and reimburse owners. Buying back the cars alone is expected to cost more than $10 billion, with a total of 475,000 Volkswagen and Audi models in the U.S. subject to the deal because their 2.0-liter TDI engines produce illegal amounts of nitrogen oxide (NOx) pollutants.