Volkswagen TDI Scandal: Summary of the Proposed Settlement Plan
If we own a Volkswagen or Audi car in Canada, that’s affected by the TDI engine scandal, good news: the manufacturer published earlier this week a settlement and compensation plan, in accordance with class-action lawyers of owners and lessees.
First and foremost, know that this settlement only concerns the 2.0-litre turbo-diesel engines, and has to be approved by Courts in Ontario and Quebec before being effective. Public audiences will be held at the end of March 2017, so we still have to wait for a while.
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The settlement plan includes monetary compensation for owners who purchased or leased Volkswagen and Audi cars equipped with 2.0L TDI engines, but there are several conditions and exceptions, so here’s a summary of what’s proposed.
Is our vehicle eligible for monetary compensations described in the settlement?
The first step is to verify if our car is equipped with an engine affected by the hidden software that reduced harmful emissions during government testing. We must log onto the www.vwcanadasettlement.ca website, set up by Volkswagen Canada, and punch in the Vehicle Identification Number (VIN) of our car. By doing this, we’re also making sure that the manufacturer will obtain our coordinates for keeping us informed of the next steps to take.
The eligible vehicles are:
Beetle, 2013 to 2015
Golf, 2010 to 2013 and 2015
Golf Wagon, 2010 to 2014
Golf Sportwagon, 2015
Jetta, 2009 to 2015
Jetta Wagon, 2009
Passat, 2012 to 2015
Audi A3, 2010 to 2013 and 2015
Owners (purchase and financing) and lessees of eligible vehicles
Here are the amounts that should be paid to those who owned the car on September 18, 2015, and that still own it.
| Model year | Eligible VW owners | Eligible Audi owners |
|---|---|---|
| 2009 | $5,100 | Not applicable |
| 2010 | $5,100 | $5,200 |
| 2011 | $5,100 | $5,200 |
| 2012 | $5,250 | $5,350 |
| 2013 | $5,500 | $5,950 |
| 2014 | $5,950 | Not applicable |
| 2015 | $7,000 | $8,000 |
Here are the amounts that should be paid to those who owned the car on September 18, 2015, but that have sold it since then, or will sell it by January 4, 2017.
| Model year | Eligible VW owners-sellers | Eligible Audi owners-sellers |
|---|---|---|
| 2009 | $2,550 | Not applicable |
| 2010 | $2,550 | $2,600 |
| 2011 | $2,550 | $2,600 |
| 2012 | $2,625 | $2,675 |
| 2013 | $2,750 | $2,975 |
| 2014 | $2,975 | Not applicable |
| 2015 | $3,500 | $4,000 |
Here are the amounts that should be paid to those who purchased the car after September 18, 2015 and still own it. However, if the purchased car was previously leased through Volkswagen Credit Canada Inc. (VCCI) by the previous owner, the paid amount will be split in half.
| Année-modèle | Eligible VW buyers-owners | Eligible Audi buyers-owners |
|---|---|---|
| 2009 | $2,550 | Not applicable |
| 2010 | $2,550 | $2,600 |
| 2011 | $2,550 | $2,600 |
| 2012 | $2,625 | $2,675 |
| 2013 | $2,750 | $2,975 |
| 2014 | $2,975 | Not applicable |
| 2015 | $3,500 | $4,000 |
Here are the amounts that should be paid to those who were a lessee of the car (through VCCI) on September 18, 2015, whether the contract is over or not. However, if we sell the car before the Approved Emissions Modification is performed (more on that later), the paid amount will be split in half.
| Année-modèle | Eligible VW lessees | Eligible Audi lessees |
|---|---|---|
| 2009 | $2,550 | Not applicable |
| 2010 | $2,550 | $2,600 |
| 2011 | $2,550 | $2,600 |
| 2012 | $2,625 | $2,675 |
| 2013 | $2,750 | $2,975 |
| 2014 | $2,975 | Not applicable |
| 2015 | $3,500 | $4,000 |
If we no longer want our vehicle, what can we do?
Volkswagen was obliged to set up a buyback program in order to repatriate as many vehicles as possible. If we own an eligible car (purchase or finance), the automaker will offer to buy back our vehicle at its wholesale value on September 18, 2015, determined by Canadian Black Book.
If we’d like to purchase a new or pre-owned Volkswagen or Audi vehicle, we can also trade in our eligible car. In return, we’ll obtain its Fair Market Value at the time of trade-in, which is normal, but also a cash payment equivalent to the difference between the wholesale value on September 18, 2015 and the Fair Market Value at the time of trade-in.
If we’re leasing a car with VCCI, we can also get rid of it. Volkswagen will terminate the lease before the end of the term, without penalty.
In all these cases, we’ll still receive the monetary compensation mentioned earlier.
Thank you Volkswagen for this money, but what’s the catch?
Obviously, the manufacturer will hand us out this money as compensation for lying to the consumers in regards to their vehicles’ harmful emissions. However, by cashing in their cheque, we give up the opportunity to sue Volkswagen for any further damages and we accept that the automaker performs the Approved Emissions Modification to our vehicle.
In short, in exchange of money, we forgive them.
What is the Approved Emissions Modification?
For now, we don’t know the details of how Volkswagen will fix the emissions levels, but also what are the consequences of these modifications on the affected engines. The Environmental Protection Agency (EPA) in the United States is handling the issue, and it’s up to them to approve or not the modifications proposed by Volkswagen. As this is being written, the EPA hasn’t yet given their approval.
Will the engines’ output be reduced? Will their fuel consumption rise? Simply put, will there be any compromises that could entice consumers not to get their vehicles’ engines fixed? On the other hand, the manufacturer will offer an extended warranty on the engines that will receive the eventual modifications. To be continued.
Other quick details
- If our car is involved in a collision and declared as a total loss between January 4, 2017 and March 5, 2017, it will no longer be eligible for the settlement, so no monetary compensation. We better drive safely this winter…
— If we’re not completely satisfied with this settlement plan, we can opt-out with a written notice by March 5, 2017. This will allow us to sue Volkswagen on our own dime. However, we obviously won’t get any monetary compensation through the settlement plan.
— To be eligible, the 2.0L TDI engine of our car must be operational on January 4, 2017.
— If we bought an eligible car from a junkyard or a salvage yard on or after September 18, 2015, the vehicle will be excluded from the settlement plan.
— Insurance companies who own totalled eligible vehicles will be excluded from the settlement plan.
— This settlement plan doesn’t concern the company’s 3.0L TDI V6 engine, which will be treated later in a separate settlement.
All the details regarding Volkswagen’s 2.0L TDI engine settlement plan are available at www.vwcanadasettlement.ca.