$14.7 Billion: With Volkswagen Deal Done, Judge Wants Owners to Stop Asking for More Dough
Is there something in diesel fuel that makes Volkswagen owners feel they’re extra, extra special? They’re clearly a hard bunch to please, as the judge overseeing the automaker’s U.S. diesel emissions settlement is tired of hearing their demands for more, more, more.
After a year of wrangling, District Court Judge Charles Breyer has approved the $14.7 billion deal, setting in stone the buyback program and cash settlements to owners and U.S. regulators. Sure, the company’s diesel vehicles pump out up to 40 cars’ worth of pollution each, but how much cash are owners expecting to collect?
Unfortunately for them, they’ll never find out. The buyback and compensation settlement hasn’t changed since the preliminary deal reached in June. A total of 465,000 owners stand to collect the pre-scandal value of their 2.0-liter diesel Volkswagen or Audi, plus an extra $5,100 to $10,000 in make-nice cash on top of that.
Still, many owners had high hopes they could wrestle more out of the apologetic automaker. Breyer’s approval of the deal wasn’t just because he wanted to get some fishing in; rather, he hoped to avoid a long litigation process.
According to Reuters, Breyer had to shoot down requests for boosted cash payouts.
“Given the risks of prolonged litigation, the immediate settlement of this matter is far preferable,” he wrote in his decision, adding that the payouts “adequately and fairly compensates” owners.
The price tag attached to the settlement comes with a wheelbarrow full of asterisks and an equal amount of question marks. On top of the $14.7 billion sum lies fines leveled and those yet to appear. A number of U.S. states charged VW for its environmental and consumer malpractice, adding to the cost, while a big payout to its angry dealer network brings the U.S. price to $16.5 billion. Another 16 states haven’t yet received their pounds of flesh (ideally paid in greenbacks, not cubes of Müller).
Then there’s the sticky subject of the 85,000 3.0-liter diesels sidelined by the scandal. A recent report claims Audi will buy back 25,000 vehicles, but there’s still uncertainty over Volkswagen and Porsche models. While it’s smaller in scope than the 2.0-liter buyback, any 3.0-liter buyback stands to be expensive given the high-end nature of the vehicles involved.
Volkswagen heads back to court on November 3 to deliver updates on that settlement, plus a fix plan that hasn’t yielded any fruit.
[Image: 410(k) 2012/ Flickr ( CC BY-SA 2.0)]
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I'm glad that it was finally approved. For the Americans, there's no more uncertainty (except for whether there will ever be a "fix"). I can keep driving my car until 2018 and will still get about $21000 back when I turn it in (I paid about $27000 for it in 2012)
We were thinking about keeping our 2013 Passat and waiting for the fix, but then I realized that 1) people who do that don't see dime one until the fix is approved and applied to your vehicle. Not that big of a deal, but then 2) there is no timetable as to when the car's Takata airbag will be replaced. So I have the opportunity to get rid of a car with a defective safety device for much more than I would have gotten in trade or private sale? Sign me up.