Defeat Device-Installed Cars Cost Volkswagen Billions of Dollars to Resolve The Issue

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Volkswagen is nearing to close an agreement to resolve claims in the United States over its admission of installing defeat devices to cheat pollution tests. The deal includes fines from regulators and owners compensation that could shell out Volkswagen billions of dollars.

Volkswagen representatives are expected to appear on court Thursday and a report to a federal judge on the discussions. U.S. District Judge Charles Breyer oversees civil litigation filed by car owners and dealers. He ordered the German auto manufacturer too have a resolve by this week or face a trial by summer. The plaintiffs' lawyers push the trial to start by July is no agreement was reached which Volkswagen opposed, The Wall Street Journal reports.

California's Air Resources Board (CARB) dumps VW Group's proposal to fix the 2.0L engines. The car manufacturer has no enough time to make whole its 3.0L diesel customers, as that group of defeat devices was found out late.

"VW will pay cash compensation to owners who either sell their vehicles back or get them fixed," Reuters reported. "Owners selling back their vehicles will get an additional cash payment on top of receiving the estimated value of the vehicles from before the emissions scandal became public in September 2015," as quoted by Ars Technica.

According to The New York Times, Volkswagen deals with a possible approximate penalty of $18 billion in the United States. While lawyers in the case forecast the actual fine placed on Volkswagen to be much less, it will still set a record for a car maker accused of violating clean air regulations. The biggest comparable fine was $100 million charged on the Hyundai-Kia group in 2014 for the violation of greenhouse gas emissions, according to The New York Times.

Volkswagen will appear on court to settle the disputes from owners of cars installed with defeat device as well as the regulators. The car maker is expected to pay billions of dollars to resolve the issue by buying vehicles it can no longer fix including regulatory fines especially from EPA.

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