The revelation that Volkswagen installed software on 11 million cars to cheat on government emissions tests will cost the company in terms of lost sales, a tarnished brand, fines and a bevy of lawsuits. The true impact on the owners of the affected cars, however, is less clear.
Admission of Guilt
VW has already admitted it installed software that turned on emissions control systems when the cars were undergoing government lab testing, then shut them off once the vehicles were on the road. Emissions controls can stunt both fuel economy and vehicle performance. The defeat mechanisms VW installed helped improve the power and performance of the cars, but it resulted in those vehicles emitting nitrogen oxide at a rate of up to 40 times the legal limit. To make matters worse, the company had widely promoted them as “clean diesels.”
Owners of the Beetles, Golfs, Passats, Audi A3s and other affected vehicles saw their resale value fall 13 percent on average between Sept. 1 and Oct. 2, 2015. The company initially announced it set aside $7.3 billion to pay for the cost of a recall that will begin in January 2016, which does not come close to covering the $38 billion in fines, lawsuits and refit costs that analysts expect Volkswagen to face. According to the Associated Press, VW will reportedly issue $500 on a universal gift card and a $500 Volkswagen voucher to the affected owners. The company is urging car owners to remain calm, emphasizing the affected cars are still safe to drive. However, many owners are already pursuing legal remedies for damages.
Breach of Warranty
The company that manufactures a car and the dealer who sells it have an obligation to ensure it meets government safety, fuel economy and emissions standards. Numerous lawsuits alleging breach of contract, breach of warranty and violations of various statutes that protect consumers from false advertising have been filed against Volkswagen and its dealers. It is likely they will ultimately be consolidated before a single judge who will handle managing any settlement.
Contact Khonsari Law Group for Product Liability and Personal Injury Attorneys
If you are a victim of the Volkswagen emissions violation, or any other faulty product, we urge you to contact us so that we may review your legal options. The consultation will be free of cost and obligation. At the Khonsari Law Group, our skilled and experienced attorneys stand ready to work diligently to protect your rights and interests under the law.