In 2015, Volkswagen was accused of using illegal software in its TDI diesel cars to skirt US emissions standards by the US Environmental Protection Agency. This was swiftly dubbed “dieselgate”, a skirmish that was a, or one of the major disruptions to the automotive industry in the last decade. Volkswagen group was quick to respond and said they will be cooperating fully with the EPA and the California Air Resource Board in their investigations.
The EPA claimed that certain VW and Audi vehicles used software that met clean diesel emissions standards when hooked up to testing equipment but then switched to a dirtier mode when disconnected. In reality, this caused the TDIs to spew up to 40 times more tailpipe emissions when driven in the real world.
In a recent report, we came to know Volkswagen Group has paid out over $9.5 billion since 2016 in settlement funds to drivers of affected vehicles, which includes: 2009-2015 model year Volkswagen Jetta, Beetle and Golf, the 2014-2015 VW Passat, and 2009-2015 Audi A3, totaling roughly 482,000 diesel passenger cars.
The massive sum came to light in a final report published by the Federal Trade Commission. In total, Volkswagen, along with Audi and Porsche (referred to as defendants in the report) made payments to drivers associated with 88% of the aforementioned vehicles. Consumers could have opted to simply have VW fix the diesel-powered cars so they aligned with federal emissions regulations, which also included some additional compensation. However, most consumers chose the option of a buyback or early lease termination with compensation. This allowed drivers to return their car at a fair market price, or return a leased vehicle with additional compensation. A reported 86% chose the latter option.
Surprisingly, the FTC (Federal Trade Commission) commended the automaker for making the entire process one of the most “successful consumer redress programs in history.” The government also praised VW Group for its efficiency in processing claims and providing consumers with valid information along the way, with the FTC drawing contrast to several other companies who haven’t been as seamless and happy to return consumers their money.