Volkswagen has reached a settlement in principle for the emissions scandal in the USA, which includes compensation totalling approximately a billion dollars.
It’s understood the settlement will include a customer compensation plan with the US government, although the specifics are yet to be disclosed as the pay-outs are likely to vary depending on the level of rework required.
However a considerable amount of this is likely to go into VW buying cars back.
“It looks like they’re moving forward in good faith and will be compensating consumers,” Carl Tobias, a product liability law professor at the University of Richmond, told USA Today. “If it’s substantial compensation, that probably helps on the PR front.”
Analysts Frost and Sullivan say that, while this is a step in the right direction to mitigate the damages from the emission scandal, sales in the US have taken a hit, falling around 5.7% in the first quarter of the year.
However it points out that US sales as a whole account for only 10% of the Group’s sales, in contrast with China which, as Volkswagen’s largest market, accounts for close to 40% of sales so therefore the company’s wider outlook is “more positive” as global sales seem to have stabilised.