Judge approves $15 billion VW emissions settlement
Owners have option of taking trade-in value or having vehicle repaired.
SAN FRANCISCO — A federal judge approved the largest auto-scandal settlement in U.S. history Tuesday, giving nearly a half-million Volkswagen owners and leaseholders the choice between selling their cars back or having them repaired so they don’t cheat on emissions tests and spew excess pollution.
U. S. Di s t r i c t Judge Charl e s Breyer said the nearly $15 billion deal “adequately and fairly” compensates consumers and gets the polluting vehicles off the road as soon as possible.
T h e G e r m a n a u t o m a k e r acknowledged last year that about 475,000 Volkswagens and Audis with 2-liter, four-cylinder diesel engines were programmed to cheat on emissions tests.
Under the agreement, owners can choose to have Volkswagen buy back the vehicle regardless of its condition for the full trade-in price on Sept. 18, 2015, when the scandal broke, or pay for repairs. In either case, Volkswagen also will pay owners $5,100 to $10,000, depending on the age of the car and whether the owner owned it prior to Sept. 18 of last year.
Vo l k s wage n h a s a g re e d t o spend up to $10 billion compensating consumers and could start buying back the cars as early as next month. Regulators have not approved any fixes.
The settlement also includes $2.7 billion for unspecified envi- ronmental mitigation and $2 billion to promote zero-emissions vehicles.
“We’re going to sell it back as soon as humanly possible and try to put this behind us,” said Joe Azam, a 35-year-old attorney in New York who owns a 2014 Jetta wagon.
Still, Azam said he thought Volkswagen “got off easy” in terms of how much it was paying vehicle owners.
Blair Stewart, a 2012 Jetta wagon owner in Palo Alto, Calif., said Volkswagen should have repaid owners the full purchase price of their vehicles.
“This is not enough to deter the kind of behavior they did,” he said.
Breyer concluded that affected car owners were not entitled to a full refund because many had “received a great deal of use out of their vehicles.” He also raised the specter of bankruptcy for Volkswagen if it had to pay the full purchase price.
The scandal has damaged Volkswagen’s reputation and hurt its sales. The company is still facing potentially billions more in fines and penalties and possible criminal charges. It also will pay up to $324 million in attorney fees and $8.5 million in out-of-pocket costs, and has agreed to pay its U.S. dealers up to $1.2 billion.
The company said in April that it has set aside $18.2 billion to cover the cost of the global scandal, which erupted in September 2015 when the U.S. Environmental Protection Agency said Volkswagen had fitted many of its cars with software to fool emissions tests.