Volkswagen reaches agreements with private plaintiffs, FTC on 3 L diesel vehicle claims in the United States

1 February 2017

Volkswagen has reached proposed agreements to resolve outstanding civil claims regarding approximately 78,000 affected 3.0 L TDI V6 diesel engine vehicles in the United States. Volkswagen submitted two agreements to the Court for approval:

1. a proposed class settlement with private plaintiffs represented by a Court-appointed Plaintiffs’ Steering Committee (PSC) on behalf of a nationwide class of current and certain former owners and lessees of eligible 3.0 L TDI V6 vehicles; and
2. a proposed Consent Order submitted by the US Federal Trade Commission (FTC).

Under the 3.0 L TDI settlement program, Volkswagen has agreed, among other terms, to provide cash payments to all eligible members of the class, and take the following specific actions:

• Recall and repair, free of charge to the customer, approximately 58,000 affected 2013-2016 Model Year Volkswagen, Audi and Porsche 3.0 L TDI V6 vehicles (“Generation 2” vehicles) to bring them into compliance with the emissions standards to which they were originally certified, if an appropriate emissions compliant repair is approved by US regulators.
• Buy back or offer trade-in credit of equal value for, or terminate the leases of, approximately 20,000 eligible 2009-2012 Model Year Volkswagen and Audi 3.0L TDI V6 vehicles (“Generation 1” vehicles) or, if approved by US regulators, modify the vehicles to substantially reduce their NOx emissions so as to allow eligible owners and lessees to keep them.

Volkswagen has agreed to pay up to approximately $1.2 billion in benefits for the 3.0 L TDI settlement program, assuming 100% participation in the program, a 100% buyback of all eligible Generation 1 vehicles and availability of an emissions compliant repair for Generation 2 vehicles.

If an emissions compliant repair does not become available by deadlines detailed in the settlement, Volkswagen has agreed to pay approximately $4.04 billion in buyback costs for Generation 2 vehicles.

The proposed settlement applies to all 3.0 L TDI V6 diesel engine vehicles that Volkswagen, Audi, or Porsche marketed or sold in the United States for model years 2009 through 2016. The settlement must be approved by the Court, which will occur in May 2017 at the earliest.

The terms of the buyback and/or emission modification for the 3.0 L TDI vehicles reflect the terms of the settlement between Volkswagen and the US Environmental Protection Agency (EPA), the Department of Justice (DOJ), and the State of California, which was announced on December 20, 2016. Under the 3.0 L engine Consent Decree with the EPA/DOJ, Volkswagen is also required to pay $225 million into a national mitigation fund to fund projects that will reduce NOx emissions.

The Plaintiffs’ Steering Committee also reached an agreement with Bosch over their role in the development of the noncompliant VW diesel vehicles.

Source: Volkswagen