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VW 'on track' to meet deadline for diesel-rigging settlement
[SAN FRANCISCO] The federal judge demanding Volkswagen AG fix 480,000 diesel-cheating vehicles in the US or get them off the road said the automaker is on pace to meet next month's deadline to reach a deal with car owners.
US district judge Charles Breyer in San Francisco reiterated on Tuesday that buybacks, cash compensation for consumers and a fund to address damages from the excess emissions and future research must be part of any settlement.
No further details were available on a settlement said to be worth about US$10 billion to resolve civil claims over cars rigged to cheat pollution rules.
Mr Breyer has said specific details will remain confidential until the agreement is completed. He has told the lawyers to present a written proposal for consideration at a June 21 hearing. A hearing on preliminary approval of a settlement is scheduled for July 26.
The German carmaker is slowly recovering as it tries to appease regulators and regain customers' trust after admitting in September that it rigged the exhaust systems of 11 million diesel-powered cars worldwide to pass official emissions tests.
Chief executive officer Martin Winterkorn stepped down less than a week after the news broke, and Volkswagen has so far set aside 16.2 billion euros (S$25 billion) to cover the costs of the scandal, including repairs and lawsuits.
The plan to be presented to the San Francisco judge covers about 480,000 2.0-litre diesel vehicles in the US and will include some buybacks.
The company is also said to be close to announcing a solution for the tainted 3-litre engines in the US that affect another 85,000 vehicles.
While an agreement would be a milestone for Volkswagen, other obstacles stand in its way to fully emerge from the eight-month-old crisis. Those hurdles include a federal criminal probe and investigations by state attorneys general.
The diesel-cheating scandal has sent shock waves across the industry and triggered VW's first annual operating loss since 1993. Admissions of manipulation and allegations of cheating by other carmakers have pressured authorities to step up scrutiny of real-world emissions and fuel economy.
In an effort to rebound, Volkswagen is preparing a plan comprised of eight key initiatives through 2025, CEO Matthias Mueller said Friday, according to excerpts of a speech at an internal management meeting at the carmaker's headquarters in Wolfsburg, Germany.
The plan, to be disclosed in June, is part of an effort to abandon old habits like centralized decision-making, allowing VW to become more open to cooperation with other companies.
The case is In Re: Volkswagen "Clean Diesel" Marketing, Sales Practices and Products Liability Litigation, MDL 2672, US District Court, Northern District of California (San Francisco).