Volkswagen Reaches ‘Dieselgate’ Settlement to Avoid US Federal Trial; VW to Buy Back Some Diesel Cars

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The German automaker, Volkswagen has reached an agreement that would avoid a hearing with the US federal court. Each affected U.S. customer will receive $5,000 and free repair of their diesel cars. VW is also offering to buy back almost 500,000 U.S. diesel cars installed with faulty emission software.

According to Germany's Die Welt newspaper via Deutsche Welle, VW's dieselgate settlement was reached a day before the scheduled court deadline. A reliable source close to the agreement claimed that VW would pay each customer with diesel car installed with emission test cheating software an amount of $5,000 (4,400 Euros). The company has also agreed to pay for the repair of the car. In the U.S., there are almost 600,000 diesel cars affected by the faulty emission software. The alleged dieselgate settlement would be presented to Judge Charles Breyer on Thursday.

The news of the dieselgate settlement comes a day before the court-imposed deadline set by Judge Breyer. If VW was unable to present a fix to the dieselgate scandal, the company could face a trial over the summer. Meanwhile, a report by Reuters say that VW would buy back nearly 500,000 2.0-liter diesel cars installed with cheating emission software in the U.S. The buy back offer covers vehicles such as Jetta sedan, the Golf compact and the Audi A3 sold since 2009. The sources also said that the company is not offering buy back to 80,000 3.0 liter diesel vehicles, including Audi and Porsche SUV models.

Despite the alleged dieselgate settlement, Yahoo reports that the car company still has to manage several lawsuits, including the manufacturer's "Clean Diesel" ad campaign filed by Federal Trade Commissions and other numerous suits filed across the world. Last month, VW agreed to come up with a resolution with the dieselgate scandal with a deadline on April 21. The publishing cited that the deal would end up VW paying nearly $3 billion to its U.S. customers.

Following the dieselgate settlement news, VW's U.S. listed shares increased to nearly 6%. VW's reps, the EPA and the Justice Department have failed to comment on the deal.

Tags
Volkswagen, Volkswagen emission cheating scandal

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