Volkswagen Ready to Roll Out Red Carpet With Generous Compensation To Dieselgate Car Owners

Volkswagen will offer generous compensation packages to the roughly 600,000 U.S. owners of diesel vehicles whose emissions are over the legal limit, the head of its claims fund told a German paper.

The German car maker has still not decided whether vehicle owners will be offered cash, car buy-backs, repairs or replacement cars, Kenneth Feinberg told the Frankfurter Allgemeine Sonntagszeitung.

Feinberg previously headed the compensation funds for the Sept. 11, 2001 attacks, BP's Deepwater Horizon oil spill and General Motors' ignition switch crashes.

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TheSteve - 2/8/2016 3:14:00 PM

+1 Boost

My understanding is that "generous compensation" is for U.S. customers only. Not Canada, European nations, or others.

Some cynical views are:

(1) The US market is the one that's most harshly critical of VW, and they need the most stroking.

(2) VW has had a hard time getting traction in the huge US auto market, even before Dieselgate. The "generous compensation" is just a VW tactic to try to "grease the rails" in that market, in the hope of increasing future sales.

(3) The US is the most litigious country on the planet, with more lawyers per capita than any other place on Earth. These "generous offerings" are designed solely to save money in class action payouts, settlements, and individual lawsuits.

(4) The risks listed above are either absent in other markets, or of much less consequence. For example, Canadians are more likely to politely complain, express their anger through email petitions, but still continue to buy VWs, whereas Americans are more likely to boycott the brand for a sustained period of time.

atc98092 - 2/8/2016 6:53:17 PM

+3 Boost

Steve, I think you are correct on all counts. I know you own an Audi, and I have two TDI VWs. If they offer something "substantial", they may keep me as a customer. My wife wants to stay with them, but I'm being a little more cautious. I like the Jetta Hybrid, but don't want that small of a car. A hybrid Tiguan would do nicely, as might the upcoming CrossBlue.My Passat, which is only a year old has lost over $4000 market value in the last few months. Remains to be seen what happens as this continues.

Dan

TheSteve - 2/8/2016 7:12:59 PM

+3 Boost

Dan (atc98092): Yeah, I own a 2015 Q5 3.0 TDI. I love the car (except for the MMI). I recently got the "you're affected" letter from Audi, with no details other than "it's safe to drive." I have neither a soft spot in my heart for VW or Audi, nor a hate-on for them. Nonetheless, I'm not pleased with the Diselgate scandal, nor with my first-hand experience regarding VAG's misleading or deceptive practices.

TheSteve - 2/19/2016 2:45:55 AM

+1 Boost

Update: Audi has rolled out a compensation package to Canada too, but if you tally up the offer in Canuck Bucks and compare its value to the US offer in American Greenbacks, the Canadian package is about 1/3 less generous than the US one.

While the US package includes a US$500 gift card redeemable at Audi dealers + $500 "good as cash" card usable anywhere, the Canadian package is made up of (1) extended roadside assistance (which hardly anybody uses), (2) 2 x extra scheduled maintenances, and (3) CAD$500 Audi gift card.

MDarringer - 2/8/2016 7:54:00 PM

-2 Boost

VW needs to buy back the cars at original list plus financing charges. Anything less is Gestapo arrogant.