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.