US judge approves $US14.7 billion compensation over VW emissions scandal

A US Federal Judge has granted final approval for Volkswagen’s compensation package, worth $US 14.7 billion, following the German company’s admission in September 2015 that its vehicles had cheated laboratory emissions tests.

The settlement was first announced in June. It affects roughly 475,000 US owners.

VW agreed to spend $US 10 billion in buyback – plus between $US 5,100 and $US10,000 per vehicle in compensation – with an additional $US 2.7 billion on environmental remediation and $US 2 billion to promote use of “zero emissions” vehicles, notes AFP.

US District Judge Charles Breyer called the compensation adequate and fair.

“While plaintiffs might ultimately prevail on their claims, the settlement provides benefits much sooner than if litigation were to continue,” AFP quotes him as saying.

“Moreover, litigation would cause additional environmental damage that the settlement otherwise reduces.”

Volkswagen’s US head, Hinrich Woebcken, said in a statement that it was “an important milestone in our journey to making things right in the United States”.

Volkswagen admitted last year that it had installed “defeat device” software. This cheats laboratory tests by switching on a low-emissions mode only in the laboratory. It was included in Type EA 189 diesel engines