VW’s $14.7 bil­lion set­tle­ment

San Francisco Chronicle - - BUSINESS - AS­SO­CI­ATED PRESS

Volk­swa­gen would re­pair or buy back pol­lut­ing vehicles and pay each owner as much as $10,000 un­der a $14.7 bil­lion deal the car maker has reached to set­tle law­suits stem­ming from its emis­sions cheat­ing scan­dal, a per­son briefed on the set­tle­ment talks said Mon­day.

The deal sets aside $10 bil­lion to re­pair or buy back roughly 475,000 pol­lut­ing Volk­swa­gen vehicles with 2-liter diesel en­gines, and to com­pen­sate each owner with an ad­di­tional pay­ment of be­tween $5,100 and $10,000, the per­son said. The per­son asked not to be iden­ti­fied be­cause the deal will not be filed in court un­til Tues­day, and a judge has or­dered at­tor­neys not to talk about it be­fore then.

Own­ers who pick the buy­backs would get the clean trade-in value of their cars from be­fore the scan­dal be­came pub­lic Sept. 18. The av­er­age value of a VW diesel has dropped 19 per­cent since just be­fore the scan­dal be­gan. In Au­gust, the av­er­age was $13,196, and last month it was $10,674, ac­cord­ing to Kel­ley Blue Book.

The set­tle­ment still re­quires a judge’s ap­proval be­fore it can go into ef­fect.

The scan­dal erupted in Septem­ber when it was learned that the Ger­man au­tomaker had fit­ted many of its cars with soft­ware to fool emis­sions tests and had put dirty vehicles on the road. In­ves­ti­ga­tors deter­mined that the cars emit­ted more than 40 times the le­gal limit of ni­tro­gen ox­ide, which can cause res­pi­ra­tory prob­lems in hu­mans. Car own­ers and the U.S. Depart­ment of Jus­tice sued.

The set­tle­ment also in­cludes $2.7 bil­lion for en­vi­ron­men­tal mit­i­ga­tion and an ad­di­tional $2 bil­lion for re­search on ze­roe­mis­sions tech­nol­ogy, the per­son said.

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