WASHINGTON--U.S. and California regulators have approved a fix for about 38,000 Volkswagen AG 3.0-liter vehicles with potential excess emissions, a decision that could save the automaker more than $1 billion, according to a letter made public on Monday.
The approval means the German automaker will not need to buy back luxury 2013-2016 model-year diesel Porsche Cayenne, Volkswagen Touareg and 2013-2015 Audi Q7 sport utility vehicles. Under a settlement approved by U.S. District Judge Charles Breyer in May, VW would have been forced to offer to buy back the vehicles if it had not won government approval for a fix.
In the May settlement, VW had agreed to spend at least $1.22 billion to fix or buy back nearly 80,000 vehicles with 3.0-liter engines. As part of that settlement, VW agreed to pay owners of vehicles who obtain fixes between $8,500 and $17,000.
Volkswagen, the best-selling automaker worldwide in 2016, could have been forced to pay up to $4.04 billion if the U.S. Environmental Protection Agency and California Air Resources Board failed to approve fixes for all 3.0-liter vehicles. Some models will need hardware and software fixes, while newer models will get only a software upgrade.
The company is still awaiting approval for fixes for 3.0-liter diesel passenger cars. The company previously agreed to buy back about 20,000 older 3.0-liter diesel vehicles.
Volkswagen said it was pleased with approval and added it is working with regulators to develop fixes for other 3.0-liter vehicles "as quickly as possible."
Last year, Breyer approved a separate settlement for Volkswagen worth up to $14.7 billion, requiring it to buy back 475,000 polluting vehicles with 2.0-liter engines. In total, VW has now agreed to spend up to $25 billion in the United States to address claims from owners, environmental regulators, U.S. states and dealers and to make buyback offers.
