Volkswagen Diesel Emissions Scandal Continues With a Settlement

• October 3, 2016
• By Pete Nisbet
• 0

The Volkswagen diesel emissions scandal rumbles on. Volkswagen AG has confirmed that it will pay an emissions settlement of $1.21 billion between 652 U.S. VW dealers. This is part of a $6.5 billion emissions settlement to which the company has agreed. This gives each Volkswagen dealer involved an average payment of $1.86 million. This will be paid over a period of 18 months under the settlement deal.

Volkswagen Diesel Emissions Settlement Deal

Volkswagen has been barred from selling any diesel vehicles in the USA since late 2015. It has stated it is not sure if will ever sell diesel vehicles again ever in the USA. Part of the settlement with VW brand dealers involves the company to continue paying incentives to dealers. It will buy back vehicles that have not been able to be sold and will also suspend any capital improvement requirements it had placed on dealers for two years. The settlement deal has still to be approved by a federal judge.

This is not the end of it for Volkswagen. It still faces emissions lawsuits that may amount to billions of dollars in fines for breaches of civil and criminal laws. Volkswagen must convince regulators that the 3 liter diesel engines fitted to around 85,000 vehicles can be fixed in order to avoid a buy-back order for these.  This would also be very costly to the company.

Volkswagen Diesel Emissions Solution

According to a Justice Department court filing on Friday, regulators are still working on a technical solution to reduce emissions in these vehicles. There will be a court hearing on October 18 where Volkswagen will have to present a viable solution.

Volkswagen has admitted that it had installed software on vehicles to deactivate controls on pollution of over 11 million diesel vehicles worldwide.  It has no defense and must meet the demands made of it by the courts.  The Justice Department stated Friday that it would continue to pursue its claims for civil penalties against the company.

So the Volkswagen diesel emissions issue continues, and it will some time before it is finally over. Meantime, VW has more expense to come and must also solve the emissions issue once and for all.