Judge grants final approval for Volkswagen diesel settlement

Aside from the re-purchasing and fixing the affected Volkswagen and Audi vehicles, the $15 billion settlement will also include the $2.7 billion payment for unspecified environmental mitigation and $2 billion for promoting zero-emissions vehicles.

About $10 billion is earmarked for buying back or repairing the affected vehicles - nearly a half-million 2-liter diesel engine cars sold between 2009 and 2015.

The drama got underway in 2015 when university researchers kept finding problems when testing VW and Audi diesel vehicles for nitrogen oxide emissions. Leases of those vehicles may be terminated without penalty, and leaseholders also may seek cash payments. It should be noted that VW hasn't finished the modification for these vehicles yet (and that the modification itself needs to be approved by regulators), but it's being worked on and will hopefully come down the pipeline soon.

Breyer turned away objections from auto owners who thought the settlement did not provide enough money, saying it "adequately and fairly compensates" them.

Under the deal, signed off by a federal judge, the owners of 475,000 VWs and Audis with qualifying diesel engines can now formally request the company buys back their vehicles from Tuesday next week.

They will also receive an additional compensation of between $5,000 and $10,000 depending on how old their vehicles are.

In this October 13, 2015, file photo, a Volkswagen Touareg diesel is tested in the Environmental Protection Agency's cold temperature test facility in Ann Arbor, Mich. Volkswagen faces a November 3 court hearing to update the court on those vehicles' status.

During a hearing on October 18 around 20 Volkswagen owners objected, but Judge Breyer described the settlement as "fair, reasonable, and adequate". Currently, Volkswagen faces lawsuits on behalf of 16 US states as well as fines from the US Justice Department.

It represented the largest civil settlement worldwide ever reached with an automaker over allegations of misconduct and fraud toward vehicle owners.

The settlement "is an important milestone in our journey to make things right in the United States", Hinrich Woebcken, chief executive of Volkswagen Group of America Inc., said in a statement. A settlement with 80,000 owners of three-liter vehicles is still being negotiated.

Cars sold from 2009 to 2016 can be repaired or bought back.

  • Zachary Reyes