Volkswagen Group to Pay $1.2 Billion for 3.0L TDI Settlement

The Volkswagen Group has agreed to pay $1.2 billion to fix or buy back approximately 78,000 vehicles equipped with 3.0-liter TDI turbodiesel engines affected by the automaker’s emissions scandal. Additionally, owners of those vehicles will receive up to $16,000 in compensation.

According to the company, it will fix model year 2013-2016 vehicles with “Generation 2” 3.0-liter TDI engines. Approximately 58,000 vehicles fall under this category and include the Volkswagen Touareg, Audi Q7, A6, A7, A8, Q5, and Porsche Cayenne. VW says it will buy back, offer a trade-in credit, or end leases for 2009-2012 Volkswagen Touareg and Audi Q7 SUVs with “Generation 1” TDI engines, though it says a fix may still be possible for these vehicles.

Automotive News reports that Volkswagen will pay $7,000 to $16,000 to anyone who chooses to get their vehicles fixed. The automaker will pay an additional $500 if the repair affects performance. Meanwhile, those who opt for the buyback option will get $7,500 in addition to the value of their vehicle.

The deal is still pending approval from regulators and a U.S. court. Volkswagen hasn’t revealed details of the possible fix, but Automotive News reports that the settlement could balloon to at least $4 billion if the proposed repair is rejected. Final approval should come by May 2017.

“We will continue to work to earn back the trust of all our stakeholders and thank our customers and dealers for their continued patience as this process moves forward,” said Hinrich J. Woebcken, CEO of Volkswagen Group of America, in a statement.

Volkswagen will also spend an additional $225 million on environmental programs aimed at offsetting excess emissions emitted by the 3.0-liter TDI engines. The automaker will pay another $25 million to California to expand electric vehicle infrastructure in that state.

Volkswagen’s 3.0-liter TDI settlement mimics the larger one reached for its 2.0-liter TDI vehicles. That settlement involved approximately 475,000 vehicles at a cost of at least $14.7 billion.

Additionally, Automotive News reports that parts supplier Bosch has agreed to $327.5 million to owners affected by both the 2.0-liter and 3.0-liter TDI engine scandal. Owners sued Bosch claiming the company helped Volkswagen develop the cheat devices involved in the scandal. Bosch points out it’s not admitting guilt, but instead is settling the case.

Source: Volkswagen, Automotive News (Subscription required)

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