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| Compensating Volkswagen’s Victims | Compensating Volkswagen’s Victims |
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| The federal government’s $14.7 billion settlement with Volkswagen over the company’s emissions cheating scandal is one of the largest consumer class action payouts in American history and a significant hit for the company. It should also act as a deterrent to future bad behavior by companies that deliberately violate rules aimed at protecting consumers and the environment. | The federal government’s $14.7 billion settlement with Volkswagen over the company’s emissions cheating scandal is one of the largest consumer class action payouts in American history and a significant hit for the company. It should also act as a deterrent to future bad behavior by companies that deliberately violate rules aimed at protecting consumers and the environment. |
| Both Volkswagen and the regulators still have a lot to do — the company to satisfy angry buyers outside the United States, the regulators to tighten inspection procedures to make sure this kind of thing does not happen again. | Both Volkswagen and the regulators still have a lot to do — the company to satisfy angry buyers outside the United States, the regulators to tighten inspection procedures to make sure this kind of thing does not happen again. |
| The settlement appears to provide fair compensation to consumers, many of whom bought their diesel cars because they believed Volkswagen’s “clean diesel” marketing campaign. It turns out these cars were a lot dirtier than the company claimed. | The settlement appears to provide fair compensation to consumers, many of whom bought their diesel cars because they believed Volkswagen’s “clean diesel” marketing campaign. It turns out these cars were a lot dirtier than the company claimed. |
| The deal, which was negotiated by federal agencies, the State of California and lawyers representing consumers, also requires the company to provide restitution for the environmental damage it has caused, in part by underwriting efforts to develop cleaner vehicles. | The deal, which was negotiated by federal agencies, the State of California and lawyers representing consumers, also requires the company to provide restitution for the environmental damage it has caused, in part by underwriting efforts to develop cleaner vehicles. |
| For years, Volkswagen, one of the world’s largest automakers, installed software in about 11 million diesel cars that allowed the company to cheat on laboratory tests for emissions of nitrogen oxides that can cause respiratory and other diseases. In actual driving, however, the vehicles belched nitrogen oxides at 40 times the levels allowed under the Clean Air Act. Most of the cars were sold in Europe but several hundred thousand of them ended up in the United States. | |
| Under the terms of the settlement, which was submitted to a federal judge for approval on Tuesday, American owners of nearly 500,000 Volkswagen cars will be able to sell their vehicles back to the company at their pre-scandal value or have them repaired. In addition, owners will receive between $5,100 and $10,000 in compensation for having been misled. Volkswagen also agreed to pay $2.7 billion into a fund that will be used for projects to mitigate the environmental damage caused by its cars. And the company will invest $2 billion over the next 10 years in zero-emissions vehicle infrastructure like charging stations for electric cars. | Under the terms of the settlement, which was submitted to a federal judge for approval on Tuesday, American owners of nearly 500,000 Volkswagen cars will be able to sell their vehicles back to the company at their pre-scandal value or have them repaired. In addition, owners will receive between $5,100 and $10,000 in compensation for having been misled. Volkswagen also agreed to pay $2.7 billion into a fund that will be used for projects to mitigate the environmental damage caused by its cars. And the company will invest $2 billion over the next 10 years in zero-emissions vehicle infrastructure like charging stations for electric cars. |
| The deal only applies to cars with 2-liter engines sold in the United States. A separate negotiation involving 85,000 cars with 3-liter engines is continuing. The Justice Department is also conducting a criminal investigation, and the company is expected reach a separate settlement soon with state attorneys general. | The deal only applies to cars with 2-liter engines sold in the United States. A separate negotiation involving 85,000 cars with 3-liter engines is continuing. The Justice Department is also conducting a criminal investigation, and the company is expected reach a separate settlement soon with state attorneys general. |
| Investigations are underway in other countries, which almost certainly will press Volkswagen to offer their consumers terms at least as good as the ones negotiated by the American government. | Investigations are underway in other countries, which almost certainly will press Volkswagen to offer their consumers terms at least as good as the ones negotiated by the American government. |
| Meanwhile, regulators in Washington and elsewhere need to improve testing procedures so that the promise of the laws governing emissions is fully realized. The Environmental Protection Agency, which is responsible for testing cars in the United States, said last year it would conduct more on-the-road examinations to supplement lab tests that Volkswagen’s software was designed to fool. | Meanwhile, regulators in Washington and elsewhere need to improve testing procedures so that the promise of the laws governing emissions is fully realized. The Environmental Protection Agency, which is responsible for testing cars in the United States, said last year it would conduct more on-the-road examinations to supplement lab tests that Volkswagen’s software was designed to fool. |
| Other governments, including the European Union, have been far more lax. The E.U. concedes that diesel cars sold there have exceeded allowable emissions levels but has given automakers several years to bring their products into compliance. This can only harm public health. Air pollution is responsible for an estimated 430,000 premature deaths a year in the E.U. and cars and trucks are a big source of those emissions. | Other governments, including the European Union, have been far more lax. The E.U. concedes that diesel cars sold there have exceeded allowable emissions levels but has given automakers several years to bring their products into compliance. This can only harm public health. Air pollution is responsible for an estimated 430,000 premature deaths a year in the E.U. and cars and trucks are a big source of those emissions. |
| Besides underscoring the importance of clean air rules, the scandal has shown that the increasing use of sophisticated software in cars, while potentially useful, also presents a growing challenge to regulators. They may never know as much about cars as the companies that make them, but they do need to understand the changes in automotive technology. | Besides underscoring the importance of clean air rules, the scandal has shown that the increasing use of sophisticated software in cars, while potentially useful, also presents a growing challenge to regulators. They may never know as much about cars as the companies that make them, but they do need to understand the changes in automotive technology. |