A U.S. judge on Tuesday authorized one of the most significant corporate settlements on record, Volkswagen AG‘s $14.7 billion offer arising from its diesel emissions scandal, and the German automaker said it would start buying back polluting automobiles in mid-November.
U.S. District Judge Charles Breyer told in San Francisco signed off on Volkswagen’s settlement with federal and California regulators and the owners of the 475,000 contaminating diesel vehicles in a turning point for the world’s No. 2 car manufacturer as it attempts to move past a scandal.
Volkswagen CEO Matthias Mueller told reporters in Berlin that Breyer’s approval was “an important milestone for us en route towards cleaning up the problem that we caused a long time back.” Hinrich Woebcken, president and CEO of Volkswagen Group of America, promised to carry out the terms as flawlessly as possible.
Breyer turned away objections from automobile owners who believed the settlement did not offer enough loan, stating it “effectively and relatively compensates” them. Owners will get the pre-scandal “trade in” value of the car and $5,100 to $10,000 in additional compensation.
“Given the dangers of prolonged lawsuits, the immediate settlement of this matter is far preferable,” Breyer wrote.
Volkswagen agreed to spend approximately $10.033 billion on the buybacks and owner compensation and $4.7 billion on programs to balance out excess emissions and improve clean-vehicle jobs.
The settlement was reached with the United States Justice Department, Federal Trade Commission, the state of California and automobile owners who had filed a class action suit versus Volkswagen. Volkswagen has admitted to misleading regulators and still faces a continuous criminal investigation.
In total, Volkswagen has actually accepted date to spend up to $16.5 billion in connection with the scandal, including payments to dealers, states and lawyers for owners. The scandal rattled Volkswagen’s international organisation, hurt its credibility and triggered the ouster of its CEO.
The settlement covers 2.0-liter polluting diesel Beetle, Golf, Jetta, Passat and Audi A3 cars and trucks from the 2009 through 2015 model years. Up to 490,000 people will participate in the settlement because some cars had more than one owner.
Volkswagen spokeswoman Jeannine Ginivan informed the car manufacturer anticipates to start redeeming automobiles in mid-November. Volkswagen has employed 900 individuals, including one to be stationed at each dealership, to deal with buybacks.
