Volkswagen Dealers to Collect $1.85 Million Each as Owners Flock to Buyout Offer

Steph Willems
by Steph Willems
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volkswagen dealers to collect 1 85 million each as owners flock to buyout offer

Volkswagen AG is making nice with its once-ornery U.S. dealer network to the tune of $1.85 million per dealer.

The automaker announced details of its $1.21 billion dealer settlement late yesterday, Reuters reports, with cash payouts to its 652 dealers spread out over the next 18 months. Meanwhile, once-loyal Volkswagen owners have hopped on the buyout bandwagon in big numbers.

Of the 475,000 emissions-cheating 2.0-liter TDI models sold in the U.S., 311,000 owners have so far opted to take part in the customer settlement. For now, the only option is a buyback and cash payout, as regulators haven’t approved a fix for the polluting vehicles. Under the settlement, 85 percent of the afflicted vehicles must be off the road by June 2019.

Whether they’ve soured on the brand or aren’t confident Volkswagen can ever offer a fix, many are turning to the cash option. One longtime Volkswagen owner told TTAC that he’ll hand over his vehicle on November 2, claiming he doesn’t believe the company can find a fix —especially one that can be incorporated into his wagon.

About 3,300 owners have opted out of the settlement, preserving their right to fight the automaker in a class-action lawsuit.

A federal judge could sign off on the settlement on Oct. 18, after the U.S. Justice Department, Federal Trade Commission and lawyers representing U.S. owners gave their approval yesterday.

Under the dealer agreement, some of the automaker’s incentive payments will continue, and the company will buy back any remaining unsold diesel vehicles. Capital improvements to dealerships requested by the automaker are suspended. Also included in the agreement is the stipulation that Volkswagen can not sell any diesel vehicles in 2016 or 2017. (The automaker isn’t sure if it even wants to market a U.S. diesel again.)

While the agreement moves Volkswagen closer to its goal of putting the diesel nightmare behind it, its 3.0-liter diesel models remain in limbo. About 85,000 Volkswagen, Audi and Porsche 3.0-liter TDI models await a settlement in the U.S., with the automaker hoping for a technical fix. If it doesn’t find one by the end of October, its only option is another expensive buyback program.

[Image: Francis Storr/ Flickr]

Steph Willems
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  • Jim brewer Jim brewer on Oct 02, 2016

    I can see the impulse to get another. VW has some unique attributes. People may not realize that the excellent performance is a direct result of the cheating. Still, it's a bad idea. I credit Matador's post that the company is corrupt or surprisingly incompetent from top to bottom, in ways that have nothing to do with diesels. We have the Boxster IMS scandal as evidence that this is systemic issue. Such matters are not easily remedied by a determination to straighten up and fly right.

  • Speedlaw Speedlaw on Oct 02, 2016

    I'm sure the "crush" will be comprehensive. Car and Driver did a bit on Mazdas a few years back, where lightly damaged cars after a shipping accident were taken apart. IIRC, the tires were holed, the airbags all deployed, and the rest crushed....just so none of the parts found their way into commerce.

  • FreedMike I suppose that in some crowded city like Rome or Tokyo, there's a market for a luxurious pint-size car. I don't think they'll be able to give them away here in the U.S.
  • TMA1 How much did exchange rates affect this decision? The Renegade is imported from Italy. I'm wondering if that's what caused the price to reach within a few hundred of the much bigger Compass. Kind of a no-brainer to pick the larger, more modern vehicle.
  • CEastwood Everytime I see one of these I think there's a dummie who could have bought a real car , but has to say look at me driving this cool thing I can't drive in the rain like an actual motorcycle that I should have bought in the first place ! It's not Batman I see driving these - it's middle age Fatman .
  • SilverCoupe I should be the potential audience for this (current A5 owner, considering an S5 in the future), but I can't say it excites me. I have never liked the vertical bars in the grilles of sporting Mercedes models, for one thing. The interior doesn't speak to me either.I would be more likely to consider a BMW 4 Series, though not the current version with the double Edsel grille. Still, I suppose it would be worth a look when the time comes to replace my current vehicle.
  • Verbal Can we expect this model to help M-B improve on finishing 29th out of 30 brands in CR's recent reliability survey?