Massive Volkswagen US payout tipped

Update: Volkswagen has agreed to pay $US15 billion to owners of vehicles affected by the dieselgate scandal in the US, as predicted. The company has pledged to fix or even buy back vehicles that cheated emissions testing, and pay owners up to $10,000 each.

pledging to buy back or fix vehicles that tricked pollution tests, and pay each owner up to $10,000.

Sally Yates, the Deputy US Attorney General, said the investigation is far from over, meaning more compensation could be on the cards.

"And while this announcement is an important step forward, let me be clear, it is by no means the last. We will continue to follow the facts wherever they go."

A $US15 billion Volkswagen compensation package for US diesel customers and government regulators is expected to be announced around 7:00am tomorrow (June 29) Australian time, but local VW owners are being discouraged from expecting similar financial recompense being offered here.

The US settlement is reported to include $US10 billion to offer buybacks to owners of about 475,000 polluting vehicles, and nearly $US5 billion in funds to offset excess diesel emissions and boost zero-emission vehicles, sources told news agency Reuters.

The US settlement also includes $US2.7 billion in funds to offset excess diesel emissions and $2 billion in VW investments in green energy and zero-emission vehicle efforts.

Volkswagen and other brands within the VW Group are in the dock globally for selling 11 million turbo-diesel vehicles which included ‘defeat device’ coding written into their software.

In Australia close to 100,000 Volkswagens, Audis and Skodas are affected and the first recall to recode software of 8000 Amarok utilities has begun.

The defeat device coding recognised when EA189 1.6- and 2.0-litre engines were being emissions tested on a rolling-road dynos and retuned them to meet regulations.

In the real world the engines were found to have nitrogen oxide emissions levels up to 40 times the US legal standard. NOx can contribute to premature death and a variety of respiratory diseases.

Speaking in a press release ostensibly issued to urge Amarok owners to respond to the ‘dieselgate’ recall that will recalibrate emissions software, Volkswagen Group Australia boss Michael Bartsch pointed out the differences between local and US vehicle pollution standards.

“The striking differences between US and Australian regulations have gone largely unreported,” Bartsch said. “US regulations are unique in the world in that they are very significantly lower than European standards in terms of NOx levels.

“Euro, and hence Australian, standards are built around lowering environmentally harmful carbon emissions and fuel consumption. We believe that the best outcome for concerned Australian customers is the free and simple software update.

“When these are approved, the owners will be immediately advised to make an appointment with their dealer for the free software upgrade (and a free hardware update for some vehicles).”

Bartsch’s position is not new. A Volkswagen Group spokesman told motoring.com.au there would be no financial compensation to Australian VW diesel owners at the global launch of the new Tiguan in April.

However, even if it declines to offer compensation voluntarily, VGA is still facing Federal Court class actions brought by two law firms, Maurice Blackburn and Bannister Law. They are due back in the Federal Court on July 7.

Bartsch said that nearly 30 per cent of the affected Amaroks have so far been through the local recall process.

VGA is also working with the Department of Industry and Regional Development for approval to commence the voluntary recall of additional vehicles.

Maurice Blackburn today issued a press release condemning the lack of local recompense for owners of affected VW vehicles, titled 'VW to settle in US but continue treating Australia as a backwater'.

"It is very disappointing that VW continues to maintain a hard line toward denying any wrongdoing to Australian consumers particularly in the face of the public apologies and news of settlements in other jurisdictions," said Senior Associate on the Maurice Blackburn Lawyers' VW class action, Dr Angus Francis.

"To deny affected Australian motorists fair and just compensation when they are prepared to compensate overseas consumers belies all of the spin coming out of the company that it is in any way sorry.

"They've paved the way overseas, and the 100,000 affected Australian motorists caught up in this global scandal are ready for VW to remedy their mistakes here now too."

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