VW close to $4.3bn US criminal settlement over emissions scandal
Volkswagen said on Tuesday it was in advanced talks to pay $4.3bn in penalties and plead guilty to criminal charges to settle with the US Department of Justice over the German carmaker’s diesel emissions scandal.
The company would also be subject to supervision by an independent monitor for the next three years.
VW said that the settlement could result in the company’s financial obligations stemming from the scandal exceeding its “current provisions”. In October it said it had set aside more than ￠18.2bn.
The final agreement is subject to approval by VW’s management and supervisory board, which are expected to meet on Wednesday.
VW, which admitted in September 2015 to installing software in its diesel cars to cheat emissions tests, is eager to resolve potential criminal charges before the DoJ political appointees overseeing the settlement talks depart with the Obama administration.
A criminal settlement in the US would be a milestone in VW’s efforts to draw a line under the affair, in which up to 11m of the company’s diesel cars worldwide were fitted with software designed to understate harmful emissions of nitrogen oxides in official tests.
In the US, where the scandal was uncovered by regulators, the affair has already cost VW $15.3bn in a partial civil settlement involving 475,000 two-litre diesel cars, an additional $1.2bn to resolve a class-action lawsuit by the company’s dealers, and a further $1bn to recall or buy back 60,000 three-litre vehicles.
In a statement on Tuesday evening, VW said it had reached a “concrete draft” of the settlement that will see it pay $4.3bn.