Volkswagen Dieselgate update: European owners get shafted, and can 85,000 3.0-liters be fixed?

July 6, 2016

Summer's here, and the time is right for dancing in the streets--unless you work for Volkswagen, where dancing is kept to a strict minimum thanks to the ongoing Dieselgate scandal. Here are a few of the not-so-clean diesel stories that have crossed our desks in the past few days:

Fix is possible for 85,000 3.0-liter diesels in the U.S.: Remember the $15.4 billion settlement Volkswagen announced last week? Well, that only covered 475,000 2.0-liter Audi and VW diesels registered in the U.S. There are still 85,000 larger, 3.0-liter Audi, Porsche, and VW diesels in this country that fail to meet federal regulations. According to Volkswagen, though, there's a fix for them! Well, maybe, assuming that (a) the fix works, and (b) it's not shot down again by the Environmental Protection Agency or the California Air Resources Board. We'll know more on August 25, when U.S. District Judge Charles Breyer has asked the automaker for an update on its progress.

Diesel owners in Europe get the shaft: If you're one of the millions of European citizens who owns a vehicle affected by the Dieselgate scandal, don't expect a payout as sweet as the one your American peers received. Though there have been calls for a similar kind of compensation package across The Pond, Volkswagen CEO Matthias Muller has responded with a resounding "nein". Speaking to the German newspaper Welt am Sonntag, Muller noted that Volkswagen could never afford to replicate such a deal in Europe, where there are far more cars equipped with illegal devices meant to cheat on emissions tests. To some, Muller's statement might sound like fair reasoning. Others may find it...less persuasive.

UPDATE: Volkswagen avoids fines in Germany: As if on cue, Germany's Transportation Minister has said that the country won't fine Volkswagen for illegally installing defeat devices on over 2 million diesels. However, the company will have to fix those cars, and it's still the subject of an investigation into criminal wrongdoing. That's not good enough for Germany's Bild newspaper though, which wonders why Europeans aren't entitled to the same compensation package that Americans are receiving. And that's a totally appropriate question.

VW sales hit five-year low: As if paying out $15.4 billion to American agencies and owners weren't enough, Volkswagen's VW brand is in the tank. June's meager 23,809 U.S. sales were nearly 22 percent lower than June of 2015. For the first half of the year, VW sales were about 15 percent below the first six months of 2015. Audi, however, managed to rise above its battered sibling, with June sales up 1 percent and year-to-date stats up 3.5 percent. Porsche was also up about 6 percent--both for June and year-to-date.

VW dealerships likely to change hands: VW's auto sales may have hit the skids, but sales of VW dealerships could heat up now that a settlement for 2.0-liter vehicles has been reached. Some dealers may feel like bowing out before things get any worse, while gamblers might see an opportunity because, really, how much worse could things get? 

Note: for purposes of clarity, "Volkswagen" has been used to refer to the Volkswagen Group parent company, while "VW" has been used to refer to the company's popular mass-market brand of automobiles.

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