April 21, 2016
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On April 21, VW diesel owners waited to finally find out how their vehicles would become emissions compliant, but that is not quite what happened. VW Canada`s President informed dealers that an agreement-in-principle has been established with U.S. authorities and the court that will include several options for affected 2.0L TDI owners including:
- Having their vehicle modified to address the emissions issue
- Having Volkswagen Group buy back their vehicle
- Cancelling their VW lease and returning their vehicle
- “Substantial compensation” for affected 2.0L TDI owners
- Volkswagen establishing a U.S. fund for environmental remediation
- Volkswagen committing funds in the U.S. to promote green automotive technology
VW Canada has promised to extend the same offers to Canadian owners; its less clear if the environmental reparations will be offered here. The prediction is that a complete fix will be unavailable for some vehicles, and Volkswagen will offer monetary compensation or a combination of money, repairs and other benefits.
Volkswagen Canada is a wholly-owned division of Volkswagen Aktiengesellschaft (VW AG.), that operates within Volkswagen`s North American Region. The diesel emissions violations dictate one corporate strategy for remediation and communication worldwide by Volkswagen AG. VW Canada is operating no differently from the Canadian divisions of other global automakers when they experience a similar crisis -- they take their orders from headquarters.
Volkswagen commands a much larger share of the market outside of North America, particularly in Europe and China, which are much more likely to develop different, regional approaches to the diesel emissions non-compliance issue than Canada. Volkswagen Canada is the tail of the American dog on emissions, due to the more robust legal environment in the United States. Last week five law firms argued before Quebec`s Superior Court to see which firm would obtain carriage of the suit. VW Canada is probably pleased to see the firms shooting at one another.
The APA believed that retaining Ken Feinberg`s law firm was a step in the right direction by VW, although they took a long time to do it. Unlike the Deepwater Horizon Gulf oil spill, after which BP retained Mr. Feinberg`s law firm to handle claims, VW has not yet positioned Mr. Feinberg out in front of the company as a sort of "Honest Broker." Volkswagen could have offered/should offer more timely information, and connected with their customers on a regular basis. Although they were dishonest, the actions illegal and the coverup a disgrace, Volkswagen could have explained more clearly what all these revelations mean to the air we breath. VW`s diesels are likely cleaner than many diesel trucks, and many vehicles from the 1990s that are still on the road today. Part of the VW diesel “clean up" should have included educating the public about what the actual harm is. Fear of the unknown is worse.
Putting a new car on someone`s driveway involves a number of complex processes in the areas of Engineering, Production/Supply-Chain, Training & Compliance, Marketing and Sales that can make for a very complex product recall process. In hindsight, it turns out to have been unrealistic to think that VW would develop a technical solution to their emissions violations quickly after the problem was uncovered. VW owners do not need to take any action at this time – Volkswagen will take the next steps when they become available, after June 21, 2016.