Preliminary Approval Granted for VW V-6 Diesel Deal
CARS.COM — A proposed $1.2 billion deal among Volkswagen Group, regulators and owners to buy back or fix roughly 78,000 Audi, Porsche and Volkswagen 3.0-liter V-6 diesel vehicles was given preliminary approval in federal district court in San Francisco today.
Related: VW Diesel Crisis: A Timeline of Events
The proposed deal, posted here, calls for the group to buy back the older V-6 diesel vehicles that violate emissions rules and to fix the newer ones, plus give those owners a cash payment. A hearing for final approval was set by Judge Charles Breyer for May 11, after which the buybacks could begin.
“We are pleased the Court has granted preliminary approval, which brings us another step closer to achieving the settlements’ goals: providing consumers fair value for their vehicles, while repairing or removing illegally polluting vehicles from the road,” said Elizabeth Cabraser, lead counsel for the committee representing owners, in a statement.
The deal, if approved, includes a series of deadlines this year in October, November and December by which time VW must have approved repairs for the vehicles or face potentially having to buy them all back. Owners for the older vehicles would get a payment for the vehicles and additional restitution; owners of the newer vehicles would get the fix, if approved, plus restitution. Those owners would get an additional $500 if the fix reduces fuel economy or performance. There are separate provisions for lessees. See the full payment table here.
The proposed deal also includes payments of $225 million to an EPA environmental mitigation fund and $25 million to the California Air Resources Board for a program supporting zero-emissions cars.
The company has admitted to installing cheating software on its diesel vehicles, which enabled them to meet clean air requirements in testing but let them emit illegal levels of pollutants on the road. VW has already agreed to plead guilty to the cheating and pay $4.3 billion in fines to settle a Department of Justice investigation; the plea is set for Feb. 24. Two Volkswagen workers have been arrested in the scandal and five more are under indictment.
VW already has a $14.7 billion settlement program underway for its approximately 475,000 2.0-liter four-cylinder diesels. The settlement includes buyback offers for all the vehicles and additional compensation to owners. Details are posted here.
Also getting preliminary approval today was a settlement with Bosch, the German supplier of the diesel software, that would provide a total of $327.5 million in additional payments to VW diesel owners.
