As expected, Volkswagen has reached a deal this week with US regulators to compensate owners of vehicles affected by its massive diesel emissions cheating scandal — a systematic global deception of customers and regulators that resulted in millions of vehicles being sold globally that produce unexpectedly high levels of pollutants. Details of the settlement were reported today by Bloomberg, AP, and the New York Times, though they won't officially be made public until submitted to a federal judge on Tuesday.
The deal, which does not affect owners outside the US, earmarks nearly $15 billion to repair or buy back affected vehicles. For owners who choose the buyback, they'll receive amounts equal to the trade-in value before the scandal broke (and that's a critical detail, because the values of those vehicles has fallen through the floor in the intervening months). In addition, owners will get anywhere from $5,100 to $10,000 in cash as an "I'm sorry" for the ordeal.
These fixes, buybacks, and payments are just the start for Volkswagen, however. The settlement, which involves the EPA and California Air Resources Board (CARB), also sets aside nearly $5 billion for zero-emission R&D and for undoing the damage its over-polluting diesels caused. There will be many lawsuits, too. And then there's the rest of the world: regulatory bodies and legal authorities worldwide are investigating Volkswagen's actions, many of which will be seeking compensation. So far, the automaker has set aside $18.2 billion to cover Dieselgate-related expenses, but it may need more.
It comes as little surprise that new CEO Matthias Müller has aggressively refocused Volkswagen on EVs, car-sharing, ride-sharing, and other more environmentally friendly initiatives since the scandal broke. Under a new corporate mandate announced earlier this month, the company hopes to have 30 new electric vehicles in production by the middle of the next decade.