Volkswagen Canada has reached a deal to compensate about 105,000 Canadian vehicle owners affected by a diesel engine emissions scandal over rigged emissions data.
The settlement could cost Volkswagen Canada and Audi Canada $2.1 billion if accepted by courts in Ontario and Quebec. Volkswagen and Audi will also have to pay an additional penalty of $15 million to the federal competition watchdog.
Under the deal, owners will be able to sell their vehicles back to the company, trade them in for new vehicles or get them repaired. Affected Canadian owners will also get between $5,100 and $8,000 in compensation, depending on the make and model of their vehicle.
According to the Competition Bureau, it would be one of the largest consumer settlements in Canadian history.
“Consumers expect and deserve truth in advertising, particularly when it relates to such a significant investment,” said John Pecman, Canada’s Commissioner of Competition. “We are pleased that Canadians will now begin to receive compensation and that Volkswagen Canada and Audi Canada will address the impact this matter has had on the marketplace.”
Harvey T. Strosberg, who is a co-lead counsel for the class-action lawsuit, the deal is a “watershed moment.”
“It’s a huge number,” said Strosberg. “No corporation has paid that money in Canadian history.”
The deal in Canada is separate from the lawsuits Volswagen and Audi face in other countries.
The Canadian settlement doesn’t include vehicles with 3.0-litre diesel engines, the Competition Bureau warned.
The bureau’s investigation found that Volkswagen Canada and Audi Canada misled consumers by claiming that vehicles sold or leased in Canada had diesel engines with reduced emissions that were cleaner than an equivalent gasoline engine sold in Canada.
The vehicles passed applicable emissions tests because an internal software was able to detect when the vehicle was being tested and altered the operation of the vehicle, in effect reducing emissions during testing, the bureau said in a statement.
With files from CBC News and The Canadian Press
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