Volkswagen AG has announced today that it has reached settlement agreements with the United States Department of Justice (DOJ) and the State of California; the U.S. Federal Trade Commission (FTC); and private plaintiffs represented by the Plaintiffs’ Steering Committee (PSC) to resolve civil claims regarding eligible Volkswagen and Audi 2.0L TDI diesel engine vehicles in the US.
Some US$15b in total has been put aside – US$10bn for buybacks and US$5bn to offset excess diesel emissions and invest in electrification and cleaner tech.
Go deeper with GlobalData
Of approximately 499,000 2.0L TDL vehicles that were produced for sale in the United States, approximately 460,000 Volkswagen and 15,000 Audi vehicles are currently in use and eligible for buybacks and lease terminations or emissions modifications, if approved by regulators. Volkswagen will establish a maximum funding pool for the 2.0L TDI settlement program of US$10.033 billion. That amount assumes 100% participation and that 100% of eligible customers choose a buyback or lease termination.
The agreements covering the proposed 2.0L TDI settlement program are subject to the approval of Judge Charles R. Breyer of the United States District Court for the Northern District of California, who presides over the federal Multi-District Litigation (MDL) proceedings related to the diesel matter.
Volkswagen also announced that it has agreed with the attorneys general of 44 US states, the District of Columbia and Puerto Rico to resolve existing and potential state consumer protection claims related to the diesel matter for a total settlement amount of approximately US$603 million.
“We take our commitment to make things right very seriously and believe these agreements are a significant step forward,” said Matthias Müller, Chief Executive Officer of Volkswagen AG. “We appreciate the constructive engagement of all the parties, and are very grateful to our customers for their continued patience as the settlement approval process moves ahead. We know that we still have a great deal of work to do to earn back the trust of the American people. We are focused on resolving the outstanding issues and building a better company that can shape the future of integrated, sustainable mobility for our customers.”
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalDataVW will also put aside US$5bn in funds to offset excess diesel emissions and boost zero emission vehicles.
The settlement constitutes the largest ever automotive buyback offer in US history.
Edmunds.com’s Director of Industry Analysis Jessica Caldwell said it is still a long road ahead for VW to repair its reputation in the US.
“Volkswagen has to swallow a $15 billion pill, but it needs to take this medicine in order to move on. This massive financial hit won’t magically make VW’s troubles disappear overnight, and it still has a long road ahead to repair its reputation among car shoppers,” she said. “The company got a head start earlier this month by announcing a long-term commitment to electrification, but it will be a long time before shoppers will trust VW as an environmentally friendly brand. The good news is that history is on Volkswagen’s side. Other automakers have successfully weathered their own high-profile scandals and VW has the resources and infrastructure in place to do the same.”
Volkswagen counts the cost of ‘dieselgate’ – Analysis
