VW Settles Dieselgate for $4.3B, Hits Record Sales in 2016
It's been quite the year for Volkswagen. The car maker was rocked by scandal after it was caught cheating on emissions tests, polluting the environment, and trying to cover the whole thing up. But when some were wondering if the company's rep could ever recover, VW went out and set annual sales records, including a recent jump in December.
And now that it's wrapping up the emissions scandal, paying $4.3 billion to settle civil and criminal charges with U.S. regulators, the worst might be behind the embattled Volkswagen brand.
The Dust Settles
VW will reportedly plead guilty to a number of criminal charges, including conspiracy to violate the Clean Air Act and the obstruction of justice, and will agree to install an independent monitor at the company who will "assess, oversee and monitor the company's compliance with the terms of the resolution, including measures to further strengthen Volkswagen's compliance, reporting and monitoring mechanisms and implementation of an enhanced ethics program."
The auto manufacturer will also pay $2.7 billion over the next three years into an environmental trust, and commit an additional $2 billion over the next decade toward development and infrastructure for zero-emissions vehicles. In all, Volkswagen is expected to spend over $20 billion to settle various government charges and consumer lawsuits, and criminal charges have been filed against six company executives as individuals.
The Sales Soar
At the same time Volkswagen was dealing one of the most expensive corporate crises in recent memory, it was cashing in at car lots worldwide. According to Reuters, the company achieved record group sales of 10.3 million vehicles in 2016 (an annual increase of almost four percent), perhaps pushing it past Toyota as the world's largest vehicle producer by volume.
How did they do it? "We made strides in resolving and overcoming the diesel crisis," said VW chief executive Matthias Mueller, "and, at the same time, initiated a fundamental change process." That simple? We wondered what the emissions scandal would do to VW's rep, but apparently the brand was bulletproof to begin with.
- Volkswagen's Diesel Scandal: Who Has Been Charged? (The New York Times)
- 3 Business Lessons From the VW Scandal (FindLaw's Free Enterprise)
- Volkswagen Emissions Lawsuits End Up in N.D. Cal. (FindLaw's Ninth Circuit Court Blog)
- Volkswagen Offers $15 Billion to Settle Diesel Scandal Case (FindLaw's Common Law)
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