clock menu more-arrow no yes

Filed under:

Volkswagen Dieselgate settlement lets US owners get rid of their cars or 'wait and see' if a fix happens

New, 46 comments

Largest automotive class action settlement in American history

Widely reported by media outlets yesterday, Volkswagen's settlement for US owners of 2-liter diesel vehicles affected by the Dieselgate scandal is now official. As expected, VW will end up shelling out about $15 billion just to cover its costs in the US — never mind the rest of the world — and to get back into the good graces of the EPA and the California Air Resources Board (CARB).

Here's the top line: affected owners will get a cash payout of somewhere between $5,100 and $10,000 for their troubles, calculated by a formula that takes into account vehicle age and model. In addition, they'll be able to choose from a buyback of their vehicle at the September 2015 NADA trade-in value — before Dieselgate broke and trade-in values plummeted — or they can "wait and see" whether Volkswagen is able to develop a fix that makes the engines compliant with emissions standards and is approved by US regulators. If no such fix is developed or approved, owners can still take the buyback instead.

Even if an owner sold their vehicle after the scandal broke — as some did, understandably upset about the cheat — the settlement still covers them, using a split between the owner as of September 18th, 2015 and the current owner. Full details of the terms are on the US District Court for the Northern District of California's website.

Affected cars include the 2013-2015 Beetle; 2010-2015 Golf; 2009-2015 Jetta; and 2012-2015 Passat, along with the Audi A3 between 2010-2013 and 2015. Volkswagen's 3-liter diesels, which the company has insisted aren't "cheating," per se (at least not in the same way the 2-liters are), aren't covered by this settlement. "Volkswagen continues to work expeditiously to reach an agreed resolution for affected vehicles with 3.0L TDI V-6 diesel engines," it says in a statement.

Up to $10,000 cash, plus a buyback or a fix

On top of compensation to individual owners, Volkswagen will be required to contribute $2.7 billion to a fund to undo environmental damage caused by the cheating vehicles and $2 billion to developing zero-emission vehicle technology.

If VW fails to get 85 percent of the cars fixed or off the road — about 380,000 vehicles — by June 30th, 2019, it'll owe more money.

The terms of the settlement still need to be approved by a federal judge in late July before a final sign-off that's expected in early October, but if it happens, the compensation will be available to owners right away. The settlement site is just placeholder text right now, but presumably, it'll be up and running at some point later today.


WHY CHRYSLER’S RECALLED GEAR SHIFT IS SO BAD