VW agrees to fix, buy back more polluting U.S. diesel vehicles

Tue Dec 20, 2016 5:57pm EST
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By David Shepardson

WASHINGTON (Reuters) - Volkswagen AG (VOWG_p.DE: Quote) has agreed to a $1 billion settlement to fix or buy back another 80,000 polluting diesel vehicles sold in the United States as the German automaker on Tuesday took new steps to put its emissions cheating scandal behind it.

The settlement deal covered luxury VW, Audi and Porsche vehicles with 3.0-liter engines, meaning Volkswagen has now agreed to spend as much as $17.5 billion in the United States to resolve claims from owners as well as federal and state regulators over polluting diesel vehicles.

The world's No. 2 automaker still faces the possibility of spending billions of dollars more to resolve a U.S. Justice Department criminal investigation and federal and state environmental claims, as well as oversight by a federal monitor.

The new agreement, settling part of litigation brought against VW by federal and California regulators, "is another important step forward in our efforts to make things right for our customers," Hinrich Woebcken, president and CEO of Volkswagen Group of America, said in a statement.

U.S. District Judge Charles Breyer announced the settlement during a hearing in San Francisco.

Volkswagen also agreed to boost electric vehicle efforts in California and faces additional costs as it works to finalize an agreement to provide what Breyer called "substantial compensation" to the owners of the 3.0-liter vehicles.

Breyer in October approved VW's earlier settlement worth about $15 billion with regulators and the U.S. owners of 475,000 polluting diesel vehicles with smaller 2.0-liter engines, including an offer to buy back all of the cars.

Breyer on Tuesday also said German engineering company Robert Bosch GmbH [ROBG.UL], which produced the software for the VW diesels, has agreed in principle to settle civil allegations made by U.S. diesel vehicle owners. Bosch confirmed it had reached the agreement, but said it was not accepting liability nor admitting to the allegations made in the lawsuit by owners who said the company was a knowing and active participant in VW's emissions cheating scheme.   Continued...

A Volkswagen logo is pictured at the newly opened Volkswagen factory in Wrzesnia, Poland, September 9, 2016. REUTERS/Kacper Pempel/File Photo - RTSSBWJ