Volkswagen to pay $14 bn for emissions

Volkswagen to pay $14 bn for emissions-rigging scandal

Washington, June 28 (IANS) Volkswagen is set to pay $14.7 billion in the US for the emissions-rigging scandal, according to details of the agreement reached between the German car manufacturer and American owners and authorities.

The details of the agreement were leaked on Monday to several US media, but is provisional and will not be officially published at least until a court in San Francisco, which is overseeing the case, will hold a public hearing on Thursday, EFE news reported.

The leak took place hours before the involved parties presented their documents which sealed the agreement between consumers, federal and California state authorities and VW before the court of San Francisco.

The New York Times said in its online edition that of the total figure, around $10 billion will be reserved for Volkswagen to buy back the vehicles at the price set before the scandal erupted in late 2015.

In addition, Volkswagen would pay another $2.7 billion to the Environmental Protection Agency (EPA) in compensation for environmental damage caused by the vehicles.

A contribution of $2 billion would be added to this number for Volkswagen to develop new projects for clean vehicles.

Owners of nearly 500,000 affected vehicles in the US can decide if they want Volkswagen to buy their cars back or if they are satisfied with the solution that the company’s engineers have developed to comply with the country’s environmental laws.

The problem of Volkswagen diesel engines rigged to cheat on emissions test is that they emit much higher levels of carcinogenic nitrogen oxides than permitted by the US authorities.

To prevent controls that would have detected illegal emissions, Volkswagen installed software that detects when the car is being tested for emissions.

The software alters the engine’s performance to minimise emissions of nitrogen oxides but also significantly reduces its performance.

The technical solution developed by Volkswagen has to ensure that the engines do not emit under any circumstances nitrogen oxides above the permitted level. But it almost certainly will hamper vehicle performance which for many owners may be an unacceptable compromise.

Volkswagen still faces a criminal investigation by the US Department of Justice, a request from the Federal Trade Commission and dozens of state investigations.

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