By on December 2, 2016

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The California regulator that played an important part in uncovering Volkswagen Group’s emissions cheating plot detailed a list of options on how the automaker will be required to spend the $800 million penance by advancing green tech and nonpolluting cars.

Some of the choices the California Air Resources Board came up with are truly terrible. 

On Thursday, the CARB said Volkswagen’s choices for the mandatory investments to be made over the next ten years include installing electric car chargers and providing services for ride-sharing or shuttle services in zero-emission vehicles. Bloomberg reports that CARB also scheduled a workshop for today to gather public input and additional suggestions.

The 10-year spending plan for the $800 million will be separated into four 30-month spending cycles.

CARB would like to see Volkswagen support the shift to EVs — something the company has been doing since getting into trouble — by expanding the green vehicle market and improving access to zero-emission cars for disadvantaged communities. Although I would hazard a guess that most extremely low income people aren’t particularly concerned with what type of powerplant their car makes use of, so long as it is affordable.

Another approved investment is the installation of hydrogen stations for fuel cell vehicles. Even suggesting this is ridiculous, considering VW’s big push toward battery electric vehicles and the extremely limited appeal of hydrogen-powered cars. CARB also suggested VW create public education and awareness campaigns that would not be allowed to feature or favor its own brand — perhaps resulting in something akin to D.A.R.E., only for automotive pollution.

“We urge VW to make early, visible progress in the beginning of the first 30-month cycle,” a CARB representative said during its presentation. After Friday’s workshop and a final board hearing, Volkswagen is required to submit an outline of its plan to California regulators by February 22nd.

Odds are Volkswagen won’t be spending a dime of that money on something silly like expanding the hydrogen fueling network. However, it could make the potential mistake of providing EV access to disadvantaged neighborhoods. While altruism — forced in this case — is a wonderful practice, what happens in ten years when VW packs up, moves on, and those communities are left with nothing? I suppose without the ride-sharing option, all of those people will suddenly be in the market for a new car.

It might not be worth the bad publicity stemming from the countless local news reports of angry mothers now incapable of delivering their children to school.

While there is a lot of wiggle room in some of these guidelines, the smart money is on VW pumping most of the cash into the power grid. The company has already teamed up with other automakers to enhance the vehicle charging network in Europe, so it would make sense to see the same occurring in the states. The move would fulfill the terms of its atonement while making EV ownership a lot more appetizing — something Volkswagen could benefit from, as it hopes to sell one million electric vehicles per year by 2025.

While the company may have settled many of its legal issues since dieselgate began, it isn’t even close to being out of the woods yet. VW still has to spend up to $10 billion to compensate drivers and buy back affected units, settle additional consumer claims surrounding the 3.0-liter vehicles, and cope with the criminal investigation being conducted by the Justice Department.

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42 Comments on “Here’s What California Wants Volkswagen to Do with Its Penalty Cash...”


  • avatar
    MartyToo

    Why not just waste the money on the coastal train?

    • 0 avatar
      kwong

      I wish they would. Better to penalize a corporation that engaged in all sorts of fraud than to levy the price on the taxpayers (mind you, VW took a lot of state and federal tax credits for supposed “cleaner” cars). But if the high-speed train is going to work, we need more higher productive cities to be closer together. The high-speed train is a great way to get about 300mi, but anything beyond that might be more cost effective to take a plane. Popular Mechanics had a interesting explanation as to why rail sucks in the United States and I couldn’t agree more with them.

      However, more efficient modes of transportation still isn’t going to fix our crumbling infrastructure. Personally, I think we’ve hit peak road. We built too much to maintain at a reasonable price.

      • 0 avatar
        OldManPants

        “I think we’ve hit peak road.”

        I think we all know this and that’s why young people I know are all like “You lucky old f*ck, you get to be a nursing home vegetable before too long.”

    • 0 avatar
      indi500fan

      No, better to use it to help fund the secession movement!

    • 0 avatar
      George B

      Instead of a coastal train, how about a monorail! https://www.youtube.com/watch?v=ZDOI0cq6GZM

      • 0 avatar
        Luke42

        Why not Hyoerloop?

        IIRC, Hyperloop was Elon Musk’s response to the california high speed rail project.

        I guess he didn’t like it either, and he though he had a better idea.

        Hyperloop is a cool idea, but I’m not willing to bet my own money on it yet. Having Volkswagen gamble their dirty money on it seems more palletable.

  • avatar
    Sorted Corty

    CARB – give me a break! Yeah the Hydrogen piece is dumb at best but we are talking about California here. At least the cash is not simply going into their tidy coffers. Seems it would be better spent on improving already contaminated environments since that is a real problem and a serious money-suck.

  • avatar
    jmo

    With Toyota and especially Honda all in on hydrogen vehicles, it sure seems like they don’t think it’s silly. What do you get that they are missing?

    • 0 avatar
      dukeisduke

      But why would VW spend money to support a technology they’re not using, one that helps the competition?

    • 0 avatar
      Luke42

      Hydrogen is silly because you can’t mine hydrogen on earth.

      The dreamy-eyed environmentalists who don’t have any engineering background believe that we’ll use renewable energy to split water and make hydrogen.

      As a dreamy-eyed environmentalist *with* an engineering background, I have two problems with this:

      1) Using electricity to split hydrogen, and burning it (possibly in a fuel cell) later, is effectively a battery chemistry and it needs to be evaluated as such. It doesn’t look like a great battery chemistry at this point, either.

      2) Most dreamy eyed environmentalists don’t know that the hydrogen we use is reformed natural gas (CH4 + O2 -> H2 + CO2). Note the CO2 there, which is one of the emissions we’re trying to avoid. Since burning hydrogen doesn’t forgo carbon emissions, why not just use the natural gas directly in the car?

      Given that hydrogen hasn’t made any substantive progress toward widespread availability despite being the next big thing for 30 years, while I can go down to my local Nissan dealer and special order a Nissan Leaf, I’d say that EVs are winning on both engineering and economic grounds.

      My personal feeling is that hydrogen isn’t getting anywhere until we can invent fusion power and/or mine the atmosphere of Saturn.

  • avatar
    notwhoithink

    It would be nice if we could get an article about how VW is already in breach of the agreed legal settlement by missing the court-ordered deadlines for providing TDI owners with written settlement offers. The “Independent Claims Supervisor” submitted a filing with the court on November 29th indicating that as of November 20th VW had only been able to adhere to the court-ordered deadlines in 52% of cases. At that time they were in breach of the court-ordered deadline on nearly 37,000 claims, and that number has only gone up in the past two weeks.

    http://www.cand.uscourts.gov/filelibrary/2891/First-Report-of-Independent-Claims-Supervisor.pdf

  • avatar
    dukeisduke

    I just figured the board would blow it on hookers and gin. How much of the money will go to kickbacks and graft? I mean, it is California.

  • avatar
    Scot 57

    I would like to see VW raise the middle finger to CARB and leave the U.S. market. CARB is nothing more than a SOCIALIST organization (so is California).

    • 0 avatar
      jmo

      And we can get back to a golden age of freedom.

      https://www.kcet.org/sites/kl/files/styles/kl_image_large/public/atoms/article_atoms/www.kcet.org/updaily/socal_focus/smoggy-civic-center.jpg?itok=-lkF6Hh8

    • 0 avatar
      Luke42

      I wouldn’t miss VW if they left the USA.

      /former Jetta owner

    • 0 avatar
      dartman

      Texas: “Don’t Mess with Texas”; “It’s Like a Whole Other Country”
      Wyoming: ” Like No Place on Earth” (truth in advertising here…)
      Ohio: “So Much to Discover” (really?)
      North Carolina: “A better Place to Be”
      Virginia: “Is for Lovers”
      Washington: “SayWA!”
      Oregon: “We Love Dreamers”
      California: “Find Yourself Here”; “Bring Money”; “Not for Deplorables”

    • 0 avatar
      jthorner

      Meanwhile, California added more jobs in 2015 than did Florida and Texas combined despite both of those states having well organized and funded missions to pull jobs out of California. Our biggest problems in California are housing costs and transportation … both caused by the ever increasing numbers of people who choose to live and work here even given the high costs.

      But go ahead and keep making fun of us :).

  • avatar
    gasser

    Why not use the money to buy back and then crush all the horrible smelly smoky diesel Mercedes from the 80s?

    • 0 avatar
      Caboose

      Then what we do will the waste veggie oil?

      The CA Assembly would have to create a new tax in order to build an underground vault for the indefinite storage of used deep-fryer fat.

  • avatar
    jpolicke

    No matter what VW chooses to apply the money to, they’re going to be criticized. Better to hand a check to CA and let them spend the money on whatever they deem fit. I’m sure they’ll use the money responsibly, like they did with the tobacco settlement.

  • avatar
    SCE to AUX

    “…improving access to zero-emission cars for disadvantaged communities”

    Q: Besides money, what restricts access to these vehicles now?

    A: Compliance cars aren’t available in 50 states. Quite literally, here in PA, I do not have access to an e-Golf or Fiat 500e, for instance. Therefore, am I disadvantaged?

    Does this mean the Tesla Model S will suddenly have a VW-paid coupon available to poor people (subject to a means test)? Or will this coupon only be available for VW products?

    Will VW help Tesla expand the Supercharger network? Didn’t think so.

  • avatar
    FreedMike

    Seems to me there’s no shortage of bridges and roads that could be fixed with that kind of money….

  • avatar
    pwrwrench

    If the money went to CARB they would probably buy a new computer system to prove that what they are already doing is “removing X tons of pollution” from California’s air.
    I second the idea to buy and scrap the 80s Mercedes diesels and include all the old diesel trucks too. They all stink.

  • avatar
    Acd

    Volkswagen should just be able to just write the checks to CARB and let them decide how they want to spend it. Either that or light four piles of $200 million in cash on fire over the next ten years. Either way will have similar effects.

  • avatar
    George B

    Maybe Volkswagen can use their $800 million CARB fine to help pay businesses generating air pollution in California, especially in the Los Angeles basin, to move to some other state. Volkswagen could also buy up 15 to 20 year old California cars and sent them somewhere far away where there is a shortage of rust-free cars. If air pollution is California’s main problem, paying to move sources of pollution somewhere else would be relatively cost-effective way to improve California air.

  • avatar
    Beerboy12

    $800 million would be well spent developing a “peoples” electric car.

  • avatar
    VoGo

    “Some of the choices the California Air Resources Board came up with are truly terrible.”

    You post this as news? Come on, TTAC! You need to post this as “Matt’s opinion”, or lose all remaining credibility.

    • 0 avatar
      SCE to AUX

      I’ve become resigned to this style here.

      During my formative education in the 1970s, we were taught to very clearly delineate between facts and opinion. Once upon a time, there was such a thing as an “opinion” or “persuasive” paper that one could write, and it was identified accordingly.

      Today’s American mainstream news outlets often blend the two – whether it’s CNN, MSNBC, or Fox. I don’t think the schools teach crisp writing techniques anymore, so we’re usually left with a blurred story.

      However, at TTAC, we all know that the reporting is colored with opinion. Sometimes, I actually want the writer’s opinion, rather than dry facts. Other times, no opinion is best.

      Hey, I guess if we don’t like the wallpaper around here, we can always move.

    • 0 avatar
      jthorner

      TTAC is all opinion all the time. It doesn’t even pretend to do journalism.

  • avatar
    Compaq Deskpro

    They should be forced to make VW badged grills for the front of any Audi Q model, slap em on and sell em already, 90’s GM style.

  • avatar
    kosmo

    Riddle me this, Batman:

    Leaving aside all topics like VW is/isn’t a crook; we need more/less government “investment”, can anybody explain to me why California specifically is getting all this money from VW?

    Shouldn’t it be a settlement with the USA in total?

    • 0 avatar
      heavy handle

      This is a settlement for violations of California’s emission standards, which are stricter than federal standards. It’s a separate legal case.

      • 0 avatar
        kosmo

        Understood, but still ridiculous. Will there be 50 such cases? If not, why not? If we’re passing VW money around for their ridiculous behavior, why is CA at the head of the line. Are they more deserving than Wisconsin, or some New England state where far more diesel VWs were sold?

        • 0 avatar
          heavy handle

          There may be 50 such cases if state AGs think they can get judges to agree, but California’s case is definitely stronger. They’ve had their own emissions regime since the 1960s, which VW clearly violated, they have well-documented air quality issues, their market for VW TDI cars was significant, and so on.

          Certainly any state that doesn’t test car emissions would have a very weak case by comparison.

  • avatar
    dartman

    Because Cali is the 6th largest economy in the world. They/We may not be able to swing a presidential election with 2 million votes, but when it comes to global business, economic power talks.


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