VW owners will get their choice.
Source says company will pay $1 billion in compensation
SAN FRANCISCO — The owners of nearly half a million polluting Volkswagens in the U.S. will have the option of selling them back to the company or getting them repaired at VW’s expense, under a deal announced Thursday by a federal judge.
The tentative agreement outlined by Senior U.S. District Judge Charles Breyer, however, left many questions unanswered, among them: How much can car owners expect in a buyback? Will they be compensated for any reduced gas mileage and performance resulting from a repair? And how soon could the program start?
Breyer, who is presiding over a tangle of litigation created by the VW emissions cheating scandal, said the deal will include “substantial compensation” for owners. But he did not elaborate and warned attorneys in the case not to talk about the continuing negotiations, saying that could cause confusion among customers.
A person who was briefed but asked not to be identified because the deal had not been made public said that Volkswagen would spend just over $1 billion to compensate owners. Elizabeth Cabraser, the lead attorney for hundreds of Volkswagen owners, disputed that figure.
Breyer set a June 21 deadline for attorneys from the U.S. Justice Department and for Volkswagen owners to file additional paperwork about the agreement.
After that, owners will get the chance to comment before Breyer signs off on any deal.
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. Car owners and the Justice Department sued.
“Although it is too soon to tell whether VW owners will be satisfied, and there are still other liabilities that must be addressed, this is the beginning of the end of the story,” said Michael Steel, an attorney in San Francisco who has advised car manufacturers.
Volkswagen owner Peggy Schaeffer, a North Carolina librarian with a diesel 2010 Jetta Sport Wagen, said she wanted VW to fix her car when she first heard about the scandal. But the more she hears about potential fixes, the more she prefers the idea of a buyback.