Home >> Business

Volkswagen's US emissions settlement to cost $15 billion: reports

The settlement reached by Volkswagen (VW) with around 500,000 U.S. diesel owners and government regulators over polluting vehicles is over $15 billion cash.

Volkswagen's US emissions settlement to cost $15 billion: reports

The settlement in this regard will be announced on Tuesday in Washington. It includes $10.033 billion to offer buybacks to owners of about 475,000 polluting vehicles and nearly $5 billion in funds to offset excess diesel emissions and boost zero emission vehicles.

The company will also announced a separate settlement with nearly all U.S. state attorneys general over excess diesel emissions. It is expected to be more than $500 million and will push the total to over $15 billion.

Spokeswomen for U.S. Environmental Protection Agency and Volkswagen declined to comment.

A source said that owners of 2.0 liter diesel VW 2009-2015 cars will receive at least $5,100 compensation along with the estimated value of the vehicles as of September 2015, before the eruption of the scandal. Some owners are likely to get $10,000 in compensation, depending on the value of the car.

The $10.033 billion is the maximum which the VW could pay if it had to buyback all vehicles. It is learned that the actual amount VW will pay could be significantly less if buybacks are taken by a large number of owners.

Another source said that some prior owners will get half of current owners, while people who leased cars will also get compensation. Owners are also liable to receive the same compensation if they choose to have the vehicles repaired.

According to a source, the settlement includes $2.7 billion in funds to offset excess diesel emissions and $2 billion in VW investments in green energy and zero emission vehicle efforts.