A fresh settlement of $1 billion has been agreed between car manufacturer Volkswagen and the US authorities for compensation over the last 80,000 vehicles which were part of VW’s emissions-deceiving scandal.
The US Justice Department also said that a criminal investigation is continuing and charges may yet be filed against the auto giant, a situation which could result in more penalties.
Additionally, the civil lawsuit brought by owners of the affected cars was said to be close to resolution and could well result in “substantial compensation” awards, according to a US judge.
Volkswagen has admitted to installing software to undermine tests on carbon emissions on 11 million cars, of which 600,000 were in the United States. The technology was able to control emissions during testing but to lower control for normal driving, leaving the vehicle emitting far more pollutants than required by law.
The new $1 billion settlement will cover buying back the faulty cars, repair work and cancelling leases on these models as well as $225 million devoted to a fund which works toward reducing nitrogen oxide pollution, an Environmental Protection Agency official said. This is in addition to the $2.7 billion in the fund from the prior settlement.
The agreement binds VW into recalling 85% of the affected cars, predominately those manufactured between 2009 and 2012, or face further fines. VW is hopeful that newer models can be made to comply with current emission standards. If so, VW would not have to buy the cars back.
This comes on top of a $15 billion compensation agreement reached with the US at the end of October which covered nearly half a million 2 litre VW diesel autos.
US Assistant Attorney General John Cruden called the settlement "another significant step in holding Volkswagen accountable for cheating Americans out of the promise of cleaner air by selling vehicles equipped with defeat devices."
The new agreement "is another important step forward in our efforts to make things right for our customers," a Volkswagen spokeswoman said in a statement.
"We are committed to earning back the trust of all our stakeholders."
