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Late last Friday, Volkswagen Group agreed to pay 652 Volkswagen dealers a total of $1.21 billion in a settlement that was proposed earlier this summer.
Each dealer would receive approximately $1.85 million.
The settlement is related to the emissions scandal that broke over a year ago—VW Group was producing diesel Jettas, Beetles, Golfs, and Passats, as well as Audis and Porsches that were giving off significantly more nitrogen oxide (NOx) than the company claimed to the Environmental Protection Agency (EPA).
To goose the numbers, the cars were outfitted with illegal software that engaged the emissions control systems on the cars when they were being tested in the lab but relaxed emissions controls while the cars were on the road.
When the EPA announced that it discovered VW Group’s defeat devices, Volkswagen dealers across the US were suddenly left with cars they couldn’t sell sitting on their lots. Lawyers for the dealers also argued that they should be compensated for VW’s tarnished image, which hurt their sales.
The settlement deal still has to be approved by a judge before it’s finalized.
Dealers will also have the option to opt out if they want to sue Volkswagen individually.
This settlement is separate from a $15 billion settlement that VW Group agreed to over the summer, which included more than $10 billion to compensate customers who bought VW’s 2.0L diesels and other money set aside in mitigation fines and to fund zero-emissions vehicles and infrastructure.
According to the Los Angeles Times, a separate filing on Friday indicated that some 311,000 VW owners of the 475,474 eligible have registered to receive compensation from the company. Only 3,300 people have opted out.
Customers will have the option to either sell their cars back to VW at the price the car was worth before the scandal hit, or, if VW can get a fix approved by the EPA, they can have their cars fixed.
All customers will receive additional compensation.