VW Gets Raped By Canada for $1.6 Billion

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As Sam Kineson used to say… it never ends:

Volkswagen AG has agreed to spend up to C$2.1 billion ($1.6 billion) to buy back or “fix” 105,000 diesel-powered cars and compensate owners in Canada, the company said today.

In June, Volkswagen agreed to a similar deal with U.S. owners, in which it would spend about $10 billion to buy back or “fix” 475,000 U.S. vehicles. In total, the company has now agreed to spend to date more than $18 billion to address diesel emissions issues in North America. The automaker still faces more costs to address larger vehicles and U.S. fines.

Volkswagen also agreed to pay a C$15 million civil administrative monetary penalty in connection with the Canadian settlement.

Kick me… please:  

“Volkswagen’s primary goal has always been to ensure our Canadian customers are treated fairly, and we believe that this proposed resolution achieves this aim,” said Volkswagen Group Canada CEO Maria Stenstroem.

Two Canadian courts will hold approval hearings around the end of March. Volkswagen will pay legal fees to the suing owners’ lawyers separately from the settlement fund.

Most of the 105,000 Canadian owners will get between C$5,100 and C$5,950 in compensation in addition to the value of the vehicle or they get the vehicle “repaired.”

Volkswagen is expected to announce a deal on Tuesday to address another 80,000 “polluting” 3.0-liter vehicles in the U.S. Reuters reported Friday that deal will include Volkswagen’s agreement to spend more than $200 million to offset additional excess U.S. diesel pollution and offer to buyback about 20,000 of the polluting vehicles, while fixing the other 60,000.

Volkswagen could face billions of dollars in additional U.S. fines to resolve an ongoing criminal investigation and federal and state environmental claims.

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12 COMMENTS

  1. VW would never have risked ruining the future of its company and its employees by such an intentional cheating scheme. Somebody in the engineering department did a number on VW.

    VW is engaged in the proper methods of finding out how it was done and who did it. Many people have been fired.

    Life goes on!

    • Hi Werner,

      I know people who work for VW, mid-level. They’re demoralized – but not by the “cheating.” Rather, by management’s pathetic writhing like a cur dog. They ought to have fought this. Defended their products. Gone for broke and committed serious money to a PR effort to educate the public.

      By caving, they have conceded – and that has legitimized the EPA and its absurd fatwas.

      Which means there will be more such.

  2. This whole thing has to be one of the most bizarre automotive (and maybe consumer product) stories ever. As far as I know, they still don’t have a CARB-approved “repair.” Cars are being sold back (my A3 goes back on the 28th), and people are getting checks as promised. They say the process is about 20 minutes or so; hand over the keys and title, they take a few pictures, and you get an email confirmation. So at least they seem to be holding up their end of the bargain. Reading some of the threads over at the TDI forums you’d think VW was stabbing their children, the way some people are acting.

    • Hi Eric,

      It literally sickens me. I have a visceral/gut reaction to stupid wasteful idiocy; to even hearing about a sound car being thrown away or gratuitously destroyed, for instance.

      I sometimes feel as though we are living Rand’s Atlas Shrugged… I just wonder whether “Atlas” ever will actually shrug…

      • We certainly can agree on that. For a few weeks I had a little bit of a crisis of conscious, should I take the buyback money? After all, I wasn’t harmed at all by the actions of VW. The government’s action most definitely did cause me harm in the form of depreciating my property’s value, but Uncle isn’t buying back the car, VW is …and under duress at that.

        Of course, most would say VW’s decision to “cheat” the system was what led to the deprecation. The fact that VW “cheated” is something that the state does all the time. District attorneys and police usually spend a lot of effort loading up charges on suspects in the hope of getting a guilty verdict on something, even if just a technicality. But it makes the resume’ look good when running for reelection. After all, any properly running unmodified TDI, when connected to an emissions testing device, will pass with flying colors. The rules didn’t say HOW the vehicle needed to pass the test, just that it DID pass the test. I think a lot of Uncle’s reaction is because VW got the best of them.

        But in the end, I opted for self-interest. Sorry, I’m not committed to ideology as much I should if I want to fit into the libertarian world. It was pretty much an offer I couldn’t refuse though. Take the generous amount of dirty money and walk away, or be stuck with worthless asset.

      • it sucks they would never allow them to at least export those cars to a country that doesn’t give a crap about pollution. What a waste. It round 2 of cars for cash.

    • That’s true, and will be for a little while. But at some point I would imagine parts and people who can work on TDI engines will get scarce. Even the Cuban automobile fleet runs on swapped engines and drivetrain parts from the former Soviet Union. The block might last forever, but the timing belt won’t. And it’s an interference engine, so a failure won’t be pretty.

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