Volkswagen is to pay out a total of £193 million to drivers in England and Wales after reaching an out-of-court settlement over the Dieselgate scandal.
Despite agreeing to settle, the group said the payments were not an admission of wrong-doing but the most “commercially prudent” course given the legal costs involved in a six-month trial in England.
The Volkswagen Group has already paid out more than £26 billion globally in fines, compensation, civil settlements and buy-back schemes in relation to the Dieselgate emissions scandal which rocked the entire car industry.
The scandal began in September 2015 when American environmental authorities discovered Volkswagen had fitted software to vehicles with EA189 diesel engines which gave misleading results under laboratory testing.
The so-called defeat device would trick the lab test equipment into thinking the vehicles passed nitrogen oxide (NOx) standards while emitting up to 40 times more pollution when out on the road. The software was fitted to 11 million vehicles globally and around 1.2 million in the UK.
The British drivers receiving payouts were involved a group litigation brought by a number of law firms, which the lawyers said would have been the biggest consumer action in UK history. Among their complaints were that they had been misled by VW and its sister brands about the sustainability of their vehicles and had damaged the value of their cars.
In a statement, the group said: “The Volkswagen Group would, once again, like to take this opportunity to sincerely apologise to their customers for the two-mode software installed in the EA189 vehicles.
“The Volkswagen Group will continue to work to rebuild the trust of their customers here in England and Wales. This settlement represents an important further stage in that process.”
Philip Haarmann, chief legal officer of Volkswagen AG, said the settlement marked an important milestone “as the Volkswagen Group continues to move beyond the deeply regrettable events leading up to September 2015”.
Bozena Michalowska and Shazia Yamin, lead solicitors at Leigh Day which was among the law firms acting for the drivers, said: “We are pleased that Volkswagen has repeated its sincere apology for the use of the prohibited two mode software.
“We are delighted that this case has finally been settled for our clients and the claimants in the NOx emissions litigation. We have been unwavering in our belief in our clients’ case, that is why we have fought long and hard for this outcome. We are clear that it was in the interest of our clients to settle this early.”