Volkswagen Canada says it’s closer to being able to sell 3.0-litre diesel crossovers now that the U.S. Environmental Protection Agency has approved a fix for the vehicles that produced excess emissions.
U.S. and California regulators say they have approved a fix for about 38,000 Volkswagen Group 3.0-litre diesel crossovers in the United States, a decision that could save the automaker more than US$1 billion, according to a letter reviewed by Reuters.
Volkswagen Canada spokesman Thomas Tetzlaff said in an email the automaker is attempting to get the same fix approved in Canada.
“Volkswagen Group is pleased that it has received approval from U.S. regulators, including the Environmental Protection Agency (EPA), for Emissions Compliant Repairs (ECRs) to bring Generation 2.1 and 2.2 3.0L V6 TDI SUVs into compliance with the emissions standards to which they were certified,” Tetzlaff said in an email to Automotive News Canada. “In keeping with the standard recall practice in Canada, we are working through the regulatory notice process that must take place before the EPA-approved ECRs can be implemented in vehicles here.”
Environment and Climate Change Canada is the federal regulator that needs to approve the fix. The agency didn’t immediately say when — or even if — the fix will be approved in Canada.
The U.S. approval, disclosed in a letter dated Friday, means the automaker will avoid having to buy back luxury 2013-16 model-year diesel Porsche Cayenne and Volkswagen Touareg and 2013-2015 Audi Q7 crossovers. Under a settlement approved by U.S. District Judge Charles Breyer in May, VW would have been forced to offer to buy back the vehicles if it had not won government approval for a fix.
In the May settlement, VW had agreed to spend at least $1.22 billion to fix or buy back nearly 80,000 vehicles with 3.0-liter engines. As part of that settlement, VW agreed to pay owners of vehicles who obtain fixes between $8,500 and $17,000.
Volkswagen, the best-selling automaker worldwide in 2016, could have been forced to pay up to $4.04 billion if the EPA and California Air Resources Board failed to approve fixes for all 3.0-liter vehicles.
The company is still awaiting approval for fixes for 3.0-liter diesel cars. The company previously agreed to buy back about 20,000 older 3.0-liter diesel vehicles.
Last year, Breyer approved a separate settlement for Volkswagen worth up to $14.7 billion, requiring the company to buy back 475,000 polluting vehicles with 2.0-liter engines.
In total, VW has now agreed to spend up to $25 billion in the United States to address claims from owners, environmental regulators, U.S. states and dealers and to make buyback offers.
In April, Volkswagen, which admitted to circumventing the emissions control system in U.S. diesel vehicles, was sentenced to three years of probation after pleading guilty to three felony counts.
Volkswagen, EPA and California did not immediately comment on Monday.
Last month, VW said it was taking another $3 billion charge to fix diesel engines in the United States, lifting the total bill for its emissions-test cheating scandal to around $30 billion.
The company is still working to put the 2-year-old scandal surrounding its emissions violations behind it, and seeking to transform itself into a maker of mass-market electric vehicles.
Greg Layson of Automotive News Canada contributed to this report.