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Volkswagen and US dealers in tentative deal after emissions scandal

Published 25/08/2016

Volkswagen has reached a tentative deal with its US dealers to compensate them for losses they said they suffered as a result of the company's emissions cheating scandal.

The value of the settlement with around 650 dealers was not disclosed, although Volkswagen said in a statement that it would include cash payments.

"We believe this agreement in principle with Volkswagen dealers is a very important step in our commitment to making things right for all our stakeholders in the United States," said Hinrich J Woebcken, CEO of Volkswagen North America.

Details of the settlement are still under discussion. US District Court Judge Charles Breyer gave the lawyers until the end of September to submit a final proposal. The deal would require Judge Breyer's approval.

Volkswagen previously reached an agreement with attorneys for car owners. That deal calls for it to spend up to 10 billion US dollars (£7.6 billion) buying back or repairing about 475,000 vehicles involved in its scandal and paying their owners an additional 5,100 dollars (£3,800) to 10,000 dollars (£7,600) each.

Details about the vehicle repairs have not been finalised.

The settlement also includes 2.7 billion dollars (£2 billion) for unspecified environmental mitigation and an additional 2 billion dollars (£1.5 billion) to promote zero-emissions vehicles.

Judge Breyer gave the deal preliminary approval last month.

It does not cover about 85,000 more-powerful Volkswagens and Audis with three-litre engines also caught up in the emissions scandal.

Volkswagen lawyer Robert Giuffra said the company was prepared to submit a fix for some of those vehicles by early November that would bring them into compliance with clean energy laws.

Any fix proposed by Volkswagen would have to be approved by government regulators before it could be implemented.

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