Canadian Volkswagen owners win $2bn Dieselgate payout

VOLKSWAGEN has agreed to pay disgruntled Canadian owners more than $2 billion in Dieselgate compensation as it attempts to settle a class action before the courts.

If approved, the $2.2 billion Canadian settlement means VW will pay 105,000 owners of EA189 2.0-litre diesel-engined cars with in-built emissions cheats between $5000 to $8000 each, and agree to buy back their vehicles if asked.

The carmaker will also have to pay the Canadian government an extra $15 million over claims that it misled buyers in advertisements that talked up the “clean” diesel technology used in the vehicles.

Volkswagen faces a number of Federal Court class actions in Australia from owners unhappy that the German premium carmaker has sold vehicles here that have included emissions cheat software that can recognise when a car is being emissions-tested, and switch into a clean-burn mode.

It is also facing similar claims here from Australia’s consumer watchdog of “false, misleading or deceptive conduct”.

Volkswagen Australia is disputing all the claims, saying the Dieselgate revelations have not broken any Australian laws and that the Australian Competition and Consumer Commission claims won’t “provide any practical benefit to consumers because software updates for cars affected by the voluntary recall are or soon will be available”.

Canada’s Competition Bureau said the class action brought against Volkswagen Canada and Audi Canada related to claims that the diesel engines used under the bonnet of the cars was cleaner than the equivalent petrol ones. The settlement does not relate to VW’s 3.0-litre V6 diesel engine, which was also scooped up in the Dieselgate scandal.

“The vehicles passed applicable emissions tests because software was installed that altered the operation of the vehicle during testing which appeared to have the effect of reducing emissions in testing,” the Competition Bureau said.

“Consumers expect and deserve truth in advertising, particularly when it relates to such a significant investment,” bureau competition commissioner John Pecman said.

“We are pleased that Canadians will now begin to receive compensation and that Volkswagen Canada and Audi Canada will address the impact this matter has had on the marketplace.”

Volkswagen Australia recently widened its recall beyond an initial fix announced for 9000 Amarok trade utes to add another 70,000 vehicles, including 2.0-litre versions of the Volkswagen Golf, Passat, Jetta, Tiguan and Caddy models, and the Skoda Superb, Octavia and Yeti models.

Audi, meanwhile, has widened its Dieselgate-related recall to include “certain Audi A4, A5, A6, Q3 and Q5 models”, with fixes for A1, A3 and TT models “ available shortly”.
Volkswagen Australia has said it will not be buying back cars, as the emissions cheats related to much stricter US emissions laws and vehicles sold here complied with all emissions standards.

“In addition, we hold the view that there is no legal basis for compensation or customer actions in this connection [to the US compensation pay-outs] in other parts of the world,” it said. “All vehicles affected are technically safe.”