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Volkswagen dismisses emissions settlement

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Volkswagen dismisses emissions settlement

VOLKSWAGEN claims there was no case to answer as it rejected a German judge’s call to settle a customer class-action lawsuit over its rigging of diesel emissions tests.

It is founded in 1937 by the German Labour Front, a Nazi labour union and is located in Wolfsburg. Volkswagen means “people’s car” in German. The group’s biggest market is in China, which delivers 40% of its sales and profits.

In 2015, Volkwagen has admitted to using illegal software to cheat on US diesel engine tests. The scandal costs US$30 billion in vehicle refits, fines and provisions.

The United States Environmental Protection Agency (EPA) said beginning in 2008 the automaker improperly installed engine control unit (ECU) software. It was later on determined to be a “defeat device which violates the Clean Air Act. The software detects when the cars were being subject to emissions testing, and then fully enabled ECU emission controls to successfully pass.

However in normal driving conditions, emission control software was shut off in order to attain greater fuel economy and additional power, thus resulting to 40 times more pollution than allowed by law.

Volkswagen admitted to using the defeat device, and has been ordered to recall approximately 482,000 cars with four-cylinder 2.0-liter TDI engines. In 2016, Volkswagen agreed to pay a settlement of $15.3 billion, the largest auto-related consumer class-action lawsuit in the United States history.

The scandal still casts a shadow over Volkswagen, with prosecutors accusing its Chief Executive Herbert Diess of holding back market-moving information on the rigged tests. Meanwhile its board has backed Diess, who is spearheading the carmaker’s efforts to reinvent itself as a champion of cleaner driving.

The cabinet approved a draft law last year which enabled consumer protection organizations to litigate on behalf of consumers. In doing so, high legal costs were avoided. Negotiations won’t be a walk in the park but the court would want to support and not impede them further.

Vzbv, a State-financed consumer protection organization has expressed confidence in being able to win or settle the case emphasizing the fact that a majority of local and higher regional courts have so far ruled in favour of motorists.

Furthermore, Vzbv is focused to point out that owners cars with type EA 189 diesel engines like that of VW, Audi, Skoda and Seat cars have been dragged and intentionally harmed by VW’s use of software that was used to cheat emissions tests.

However, Volkswagen has said that there was no legal basis for consumers in Germany to seek compensation.

Nearly all US owners of affected cars agreed to take part in a US$25 billion settlement in 2016 in the US that addressed claims from them, environmental regulators, US states and dealers and included buybacks and additional compensation for about 500,000 owners.

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