Volkswagen Pays $1.5 Million In Dieselgate Settlement

When Volkswagen (VW) faced the music for the massive “Dieselgate” scandal in 2015, industry experts believed that the German automaker would feel the lasting effects for a long time. It seems those experts were right as VW is still feeling the fall out from their emissions fraud saga six years later.

According to a report from Reuters, Volkswagen AG announced that they have agreed to pay a 1.5 million dollar settlement to New Hampshire and Montana against environmental claims that stemmed from the 2015 diesel emissions “cheating” software debacle.

The settlements equate to approximately $280 per vehicle, much less than what the involved states initially asked for. Volkswagen and “several courts” have previously mentioned massive financial figures as the maximum liability that VW might face. A key factor is the issue of states having the ability to enforce emissions laws over changes to emissions software that were made after the vehicles were sold.

Volkswagen will pay out $1.15 million to New Hampshire in addition to promising that they will build a high-speed EV charging station in the state. Additionally, VW is paying $357,280 to the state of Montana.

Initially, New Hampshire wanted $25,000 per vehicle, per day and Montana was seeking $10,000 for each violation per day. This settlement covers approximately 5,500 vehicles. A bit of math reveals that if both states got what they initially requested, VW would have been required to pay a minimum of $192 million.

New Hampshire and Montana are not the only states looking for a payout from Volkswagen. VW is currently trying to get the U.S. Supreme Court to reverse a ruling in Ohio that would allow the state to move forward with its own Dieselgate lawsuit. According to Volkswagen’s request to the Supreme Court, Ohio’s lawsuit could end up costing the German automaker $127 billion per year.

What was Volkswagen “Dieselgate”?

2021 Volkswagen Golf. Cars like this from VW were targets of the dieselgate scandal
2021 VW Golf | Volkswagen

The Dieselgate scandal started in 2015 when the Environmental Protection Agency (EPA) cited Volkswagen for violating the Clean Air Act. The notice was applied to the entire Volkswagen Group, which included Audi and Porsche. The notice specifically targeted VW’s TDI diesel engines.

The EPA’s citation claimed that Volkswagen technicians were purposefully altering emissions software of TDI engines during standardized emissions testing so that vehicles would pass, effectively falsifying information. After the tests, the techs would re-tune the ECUs of the TDI engines.

It seems that Volkswagen was concerned that their TDI diesel engines would not make enough power to compete with competitors in the same segment if they held to the required emissions standards.

Volkswagen was not the only automaker to get caught up in emissions issues. VW, BMW, and Daimler were all hit with fines of up to 1 billion dollars by the European Commission charged with enforcing EU laws. The penalties were levied against the automakers because it was found that they all possessed the technology to bring their vehicles within required emissions standards but failed to do so.

Those actions make the message clear to automakers: do not cheat emissions testing and use resources to make sure vehicles are compliant or face the consequences.

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