Automaker Volkswagen AG and U.S. government regulators have reportedly struck a deal in which the company will pay upwards of $15 billion to compensate U.S. owners of the company’s diesel-powered vehicles, to offset excess emissions from the vehicles, and to invest in clean energy programs.
Of the total settlement, VW will pay about $10 billion in an offer to owners to buy back 475,000 of the vehicles in which the company had installed software that defeated emissions tests by providing results indicating lower emissions levels than when the vehicles were being used in everyday operation.
According to a report from Reuters,owners of 2.0-liter diesel vehicles built between 2009 and 2015 will receive $5,100 plus the estimated value of the vehicle as of last September, when the cheating scandal was first discovered. Prior owners who sold their vehicles prior to last September will get half the amount of current owners and drivers who leased the vehicles will get some compensation as well.
Some $2.7 billion in settlement funds are essentially a fine to offset the excess emissions and another $2 billion will be spent over 10 years on green energy and zero emissions programs.
VW still has to reach an agreement with U.S. regulators related to 85,000 3.0-liter Porsche, Audi, and VW vehicles and the amount of a fine for violating the U.S. Clean Air Act.
The emissions-cheating scandal affects about 11 million VW vehicles worldwide and European regulators are seeking similar settlement for some 8.5 million VW vehicles sold in Europe.
The settlement does not include investors’ lawsuits or a criminal investigation by the U.S. Department of Justice.
The reported settlement has given VW shares a boost on the Xetra where the stock traded up around 4% at €110.10.