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Federal court approves $225M settlement in VW 3.0L diesel case; California receives $66M plus two new VW ZEV models

The Volkswagen Group will pay $225 million, including $66 million to California, for harm resulting from the sale of its 3.0-liter diesel passenger cars that included emissions control “defeat devices,” under partial Consent Decrees (earlier post) approved by a Federal court.

In addition, VW will contribute to California’s ZEV market by introducing two new ZEV models, plus the electric e-Golf, or its replacement, by 2019. One of those new vehicles must be an electric SUV. The company will also introduce a second SUV by 2020. It must collectively sell at least 35,000 of these various ZEV models between 2019 and 2025.

US District Court Judge Charles Breyer signed the agreements between the automaker, the California Air Resources Board (CARB), the US Environmental Protection Agency (US EPA) and the US Department of Justice (US DOJ). One decree is a national agreement; the second is California-specific. California will receive $41 million from the national agreement and $25 million under the California agreement.

VW admitted to CARB engineers in November 2015 that it installed “defeat devices” that altered the operation of emissions control equipment in light-duty, 3.0-liter passenger vehicles manufactured and sold between model years 2009 and 2016. There are approximately 87,000 of these vehicles in the US and about 17,000 of them (20%) in California.

This is a separate partial consent decree from one approved earlier for harm from VW’s 2.0-liter diesel cars with a similar defeat device.

California will receive about $41 million from the national mitigation trust for the environmental damage caused by VW’s deception. This money will be spent on projects to reduce smog-producing pollution, such as incentivizing clean, heavy-duty vehicles and equipment in disadvantaged communities.

In a separate California decree, an additional $25 million dollars will be invested to advance availability of cleaner vehicles in California’s disadvantaged communities.

The state will undertake a public process to allow members of the Legislature and the public to provide input and comments on potential mitigation projects to be funded by the settlement.

VW also agreed to place a second Green City project in California. This could include such features as zero-emission vehicle (ZEV) ridesharing projects or ZEV transit and freight applications. The selected city must have a population of about 500,000 and consist primarily of disadvantaged communities. A first Green City was called out in the Consent Decree for the 2.0 liter vehicles. No city has yet been named.

Background. Following publication of a report indicating high emissions from Volkswagen vehicles in over-the-road testing, CARB conducted a focused investigation which ultimately led to Volkswagen’s admission in September 2015 that the company had installed defeat devices in all of its 2.0 liter diesel vehicles manufactured between model years 2009 and 2015.

This was followed in November 2015 by an admission by Audi engineers that 3.0 liter diesel passenger cars manufactured by VW, Audi and Porsche in model years 2009-2016 also contain defeat devices. VW owns all three manufacturers.

Affected 3.0 diesel models include:

  • 2009 VW Touareg, Audi Q7
  • 2010 VW Touareg, Audi Q7
  • 2011 VW Touareg, Audi Q7
  • 2012 VW Touareg, Audi Q7
  • 2013 VW Touareg, Audi Q7, Porsche Cayenne Diesel
  • 2014 VW Touareg, Audi Q7, Porsche Cayenne Diesel, Audi A6, A7, A8, A8L, Q5
  • 2015 VW Touareg, Porsche Cayenne Diesel, Audi Q7, A6, A7, A8, A8L, Q5
  • 2016 VW Touareg, Porsche Cayenne Diesel, Audi A6, A7, A8, A8L, Q5

As a result of the 2.0 liter and 3.0 liter Consent Decrees, California is expected to be allocated a total of about $423 million from an Environmental Mitigation Trust, explained in the first Consent Decree. (Earlier post.) That money is to mitigate the lifetime excess NOx emissions of the VW vehicles with the defeat device. Under the terms of the Consent Decree VW must invest $800 million for zero-emission vehicle projects in California over a 10-year period.


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