Volkswagen, at the cost of $1.2 Billion settles part of the diesel scandal on its 3.0 litre engined cars.

VOLKSWAGEN REACHES SETTLEMENT AGREEMENTS WITH PRIVATE PLAINTIFFS AND U.S. FEDERAL TRADE COMMISSION ON 3.0L TDI V6 VEHICLES IN THE UNITED STATES

• Program, if approved, would include provisions to recall and repair most affected vehicles.
• Options for older affected vehicles include buybacks or trade-in credits, or lease termination.
• All eligible owners and lessees of affected vehicles will receive cash payments.

Volkswagen AG and Volkswagen Group of America, Inc. (together, Volkswagen) announced today that they have reached proposed agreements to resolve outstanding civil claims regarding approximately 78,000 affected 3.0L TDI V6 diesel engine vehicles in the United States.

Two agreements have been submitted to the Court for approval: (1) a proposed class settlement with private plaintiffs represented by a Court-appointed Plaintiffs’ Steering Committee (PSC) on behalf of a nationwide class of current and certain former owners and lessees of eligible 3.0L TDI V6 vehicles; and (2) a proposed Consent Order submitted by the U.S. Federal Trade Commission (FTC).

“With the Court-approved 2.0L TDI program well under way and now this proposed 3.0L TDI program, all of our customers with affected vehicles in the United States will have a resolution available to them. We will continue to work to earn back the trust of all our stakeholders and thank our customers and dealers for their continued patience as this process moves forward,” said Hinrich J. Woebcken, President and CEO of Volkswagen Group of America, Inc.

Proposed 3.0L TDI Settlement Program

Under the 3.0L TDI settlement program, Volkswagen has agreed, among other terms, to provide cash payments to all eligible members of the class, and take the following specific actions:

• Recall and repair, free of charge to the customer, approximately 58,000 affected 2013-2016 Model Year Volkswagen, Audi and Porsche 3.0L TDI V6 vehicles (so-called Generation 2 vehicles) to bring them into compliance with the emissions standards to which they were originally certified, if an appropriate Emissions Compliant Repair is approved by U.S. regulators.
• Buy back or offer trade-in credit of equal value for, or terminate the leases of, approximately 20,000 eligible 2009-2012 Model Year Volkswagen and Audi 3.0L TDI V6 vehicles (so-called Generation 1 vehicles) or, if approved by U.S. regulators, modify the vehicles to substantially reduce their nitrogen oxide (NO_x) emissions so as to allow eligible owners and lessees to keep them.

Volkswagen has agreed to pay up to approximately $1.2 billion in benefits for the 3.0L TDI settlement program, assuming 100% participation in the program, a 100% buyback of all eligible Generation 1 vehicles and availability of an Emissions Compliant Repair for Generation 2 vehicles. Volkswagen expects to be able to bring affected Generation 2 vehicles to the same emissions standards to which the vehicles were originally certified.

Volkswagen will begin the 3.0L TDI settlement program as soon as the Court grants final approval to the settlement agreements. At the earliest, approval will occur in May 2017. 

Potential claimants under the class settlement do not need to take any action at this time. Individual class members will receive extensive notification of their rights and options (including the option to “opt out” of the settlement agreement) if the Court grants preliminary approval of the proposed class settlement at a hearing scheduled to take place on February 14, 2017. More information about the proposed 3.0L TDI settlement program can be found at www.VWCourtSettlement.com.

The proposed settlement applies to all 3.0L TDI V6 diesel engine vehicles that Volkswagen, Audi, or Porsche marketed or sold in the United States for Model Years 2009 through 2016. The vehicles are divided into two generations, as follows:

Generation 1 Vehicles

Model		Model Years
Volkswagen Touareg		2009-2012
Audi Q7		2009-2012

Generation 2 Vehicles

Model		Model Years
Volkswagen Touareg		2013-2016
Audi Q7		2013-2015
Audi A6, A7, A8, A8L, Q5		2014-2016
Porsche Cayenne Diesel		2013-2016

If Volkswagen is unable to obtain a timely approved Emissions Compliant Repair for eligible Generation 2 vehicles, it will offer to buy back or provide trade-in credit of equal value for, or terminate the leases of, eligible Generation 2 vehicles and may also seek approval by U.S. regulators to offer customers a modification to substantially reduce their NO_x emissions.

The 3.0L TDI settlement program also includes a proposed Consent Decree reached with the U.S. Department of Justice (DOJ) on behalf of the Environmental Protection Agency (EPA) and a proposed agreement with the State of Califonia by and through the California Air Resources Board (CARB) and the California Attorney General on December 20, 2016. 

The program is subject to the approval of Judge Charles R. Breyer of the United States District Court for the Northern District of California, who presides over federal Multi-District Litigation (MDL) proceedings related to the diesel matter.

As announced previously, under its proposed Consent Decree with the DOJ, Volkswagen will contribute $225 million to the environmental remediation trust that is being established under Volkswagen’s 2.0L TDI settlement program in the United States to fully mitigate the excess, lifetime NO_x emissions of the affected 3.0L TDI V6 vehicles. 

As part of its agreement with the State of California, Volkswagen will also pay $25 million to CARB to support the use of zero emissions vehicles (ZEVs) in the State. 

By their terms, the proposed agreements announced today are not intended to apply to or affect Volkswagen’s obligations under the laws or regulations of any jurisdiction outside the United States. 

Regulations governing NO_x emissions limits for vehicles in the United States are much stricter than those in other parts of the world and the engine variants also differ significantly. This makes the development of technical solutions in the United States more challenging than in Europe and other parts of the world.

Volkswagen in the United States

Volkswagen Group of America (VWGoA), a wholly owned subsidiary of Volkswagen AG, employs more than 6,000 people in the United States and supports more than 1,000 dealer locations in all 50 states. 

Volkswagen has more than 60 years of history in the United States, where VWGoA maintains more than 30 U.S. locations including a LEED Platinum-certified manufacturing facility in Chattanooga, Tennessee.

The Chattanooga facility employs more than 2,500 people and supports suppliers who provide some 9,200 jobs. The facility produces the Volkswagen Passat and has recently expanded to accommodate production of a new, seven-passenger midsize SUV, the Volkswagen Atlas. 

Volkswagen is investing $900 million to expand its U.S. manufacturing footprint through production of the new SUV as part of Volkswagen AG’s plan to invest more than $7 billion in North America from 2015 through 2019.

USA - General Motors invests $1.2 Billion at Fort Wayne to continue pickup manufacture.

Fort Wayne construction to continue award-winning pickup manufacturing

General Motors is investing $1.2 billion in its full-size pickup truck plant for upgrades and technology that will improve the plant’s competitiveness in assembling high-quality light- and heavy-duty models.

Construction of the new pre-treat, electro-coat paint operation and sealing facility, expanded body shop, expanded and new material sequencing centers, and upgraded general assembly area is expected to begin in June and take several years to complete. Full-size truck production schedules will be unaffected by the construction.

“This investment is more evidence that the customer is at the center of every decision we make,” said Cathy Clegg, GM North America Manufacturing vice president. “Truck customers demand top quality. The upgrades at Fort Wayne Assembly will enable our team to continue delivering for them for years to come.”

The investment includes many technological and environmental upgrades:

• New pre-treatment facility featuring thin-film paint pretreatment
• E-coat paint customized to each vehicle style, resulting in superior coverage and curability
• GM-patented radiant tube ovens for exceptional paint finish and lower energy use
• New equipment that accommodates the many variations of the truck cab and box being placed on the chassis
• New skillet conveyance systems for instrument panel assembly intended to improve worker ergonomics, leading to better product quality.

“These new technologies and equipment will help fulfill the mission of the men and women of Fort Wayne Assembly and UAW Local 2209 to build the best full-size trucks available,” said UAW Vice President Cindy Estrada. “The investment improves the plant’s competitiveness so we can continue contributing to the community as well.”

Said Indiana Gov. Mike Pence: “Around the world, Indiana is known as a proven leader in advanced manufacturing. Powered by a pro-growth business environment and a highly-skilled workforce, GM is leveraging Indiana’s strengths to help it remain competitive across the globe.

Today’s announcement marks a significant promise to the Hoosier State and ensures GM’s presence in Indiana and its support of Hoosier jobs long into the future, reaffirming that Indiana is a state that works for business.”

Fort Wayne Assembly began building light-duty trucks in 1986. Today, it is a three-shift operation with approximately 3,800 employees who build light- and heavy-duty regular and double cab full-size trucks.

The investments in Fort Wayne are part of the $5.4 billion that GM said April 30 it would invest in U.S. facilities over the next three years.