M 93: „Dein Nordrhein-Westfalen“ via Foter.com - CC BY
VW Beetle 2015
Volkswagen has just recently reached a class-action settlement in the United States. So what does that mean for Canadians that own or lease one of the 2.0L diesels?
What models are included in the settlement?
First, let’s remind ourselves what specific TDI models from Volkswagen and Audi were included in the recent settlement that specifically excludes 3.0L TDI for the moment. The vehicles covered include:
- 2010 – 2015 Golf
- 2009 – 2015 Jetta
- 2013 – 2015 Beetle
- 2012 - 2015 Passat
- 2010 – 2015 Audi A3
How much will US owners get for returning their car?
If the owner chooses to return the car, they will receive two payments. Payment one is based on a market value set just prior to the disclosure of the scandal. The exception is for 2015 models where owners will receive about 72% of the purchase price. Payment number two is an “owner’s restitution” amount that is based on a 20% of resale value plus roughly USD$3,000. Owners are guaranteed a minimum of USD$5,100.
What about a leased vehicle?
If you leased your car there is a complete payout without penalty and you get 50% of the otherwise “owner’s restitution” payment (no minimum though). This also applies if you returned a leased vehicle after September 18, 2015.
What about if the car was sold or destroyed in an accident?
If the car was sold between September 18, 2015 and June 28, 2016, the “owner’s restitution” amount is split between the old and new owner. Even if you destroyed your car after September 18, 2015, you are still eligible for the “owner’s restitution” amount.
What about keeping the car and getting it fixed?
The interesting question here is whether the car can be “fixed” to meet acceptable emission standards. Without doing a complete retrofit to accommodate the “AdBlu” system – which is far too expensive to do, all other “tweaks” will not eliminate the required amount of NOx. So, the cars can’t be completely fixed and will most likely have their performance affected as well as investing your time and effort dealing with the recall. Even if you decide to keep the car, owners are still eligible for the “owner’s restitution” amount.
What’s the likely best option for an owner?
My guess is that most owners will opt to return the car, take the money and buy a new non-diesel model. In a recent article written by David Booth, he estimated that a 2015 Passat TDI SEL would get the owner about USD$32,900 and they could then get a brand new 2016 1.8L turbo Passat for USD$30,495. Inn other words, you can actually come out ahead.
OK – so what about us Canadians?
There are about 107,000 affected vehicles in Canada not even counting the 3.0L V6 TDIs. Volkswagen Canada remains with the position that our local laws/courts are different and so the outcome is to be determined. They have said that the 2.0L fix when finally approved in the US will be applied here in Canada. It remains to be seen whether Transport Canada and our related government and environmental groups have the willpower and fortitude to drive the same deal for us Canadians. Perhaps all 107,000 owners should not waste any more time to get active and communicate with their elected representatives about the need for a fair and similar deal in Canada.
