The Volkswagen settlement is still a criminal rip-off
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Genuine thank you to all my friends who have been sending me congratulations on my impending big VW payday.
Around half a million diesel vehicles are covered by the deal. Consumers will be able to choose between selling their car to Volkswagen (for its resale value before the news of the scandal broke) or having their car repaired by the automaker to reduce its emissions in compliance with U.S. law.
Either way, car owners will also receive a “restitution payment” of between $5,100 and $10,000 as compensation for Volkswagen’s misconduct.
That $10,000 number looks pretty nice, I’ll grant you. But let’s take a step back and see what this really means.
To review: Over seven years, VW sold 11 million cars all around the world equipped with “clean diesel” tech, which promised higher gas mileage and less pollution. In 2009, the first model year, the US hybrid market was entirely Prius-based and the electric car market was almost non-existent, so VW’s “TDI” family was a big deal for eco-conscious people who needed a car.
In 2010, my ’99 Volkswagen GTI was really starting to crack up, and I’d just started a new car-commute job and welcomed a second baby into the world. So I used a discount with my employer at the time, and purchased a VW Jetta SportWagen TDI. (They call it a “sport” wagon so men will buy it without feeling feminized by a wagon’s association with soccer moms, because male consumers are fragile.)
Buying it was a pain. The dealer told me that the Bay Area had been the highest demand region for TDIs, and I believed him. After all, in 2010 Bay Area Toyota dealers still had months-long wait lists for Priuses. So buying my TDI meant waiting a few weeks, and having no control over options, color, etc. You get what you get, treehugger.
I paid $38,000 for this car. That was, again, with an employee discount that promised me the invoice price. I paid off my loan last year, and I’d assumed by now I’d have an economical, relatively green car for at least another 7 years.
But operating it has also been more annoying than expected. Only a small percentage of gas stations even offer diesel, and when they do, it consistently costs more than even premium gasoline. When you are paying $3/gallon for regular unleaded, I am paying closer to $4. There are other higher costs of ownership, too, including more expensive maintenance.
And what did we get for this? On a good tank, 33 mpg. More often, it was 30–31 mpg, driving around the city and on the local freeways. On the best day, it was far less than the 45 mpg+ that VW promoted.
If you bought a regular-gas Jetta last year, you probably get better gas mileage than I do.
Despite this marginal mileage improvement, it turned out that the whole thing was a fraud. These TDIs were spewing NOx at more than 40 times the federal limit. The company had installed a regulator to reduce emissions only when it detected that it was being tested by the Feds.
NOx are terrible pollutants. They have been implicated in about 58,000 deaths a year just in the US, according to one study. Meanwhile, in the UK, pollution monitors had been wondering for years why air quality had been getting worse even as VW had been filling their roads with “cleaner” cars.
So, I think we can all agree, fuck you, Volkswagen.
Now, here comes the settlement.
First there are the fines, the public restitution. VW owes people all over the world for their crimes. God willing, legal systems will basically suck every Euro of ill-gained profit from this corporation’s bones, leaving just enough to keep it solvent. Every living thing on the planet was victimized by VW’s fraud. We’re talking about 11 million cars here.
But then we get to the direct victims of the fraud. VW has promised to fix the fixable models. This will alter the performance of the car, with negative impact to both gas mileage and engine power. So you have a less driveable, less economical car than the one you thought you were buying. VW will give you $5,000 for your trouble, barely enough for a down payment for something else if you want to unload your newly crippled TDI.
My earlier-gen model will most likely be unfixable. So instead, they’ve promise to give me pre-scandal Blue Book value, plus $5,000-$10,000 (I have no idea where I fall in that range, and the formula for this compensation has not been released.)
This means that for my $38,000 car, for which I dealt with the hassles and expense of a diesel engine, I will get around $21,000, give or take a few thousand.
In other words, for being defrauded on my purchase, I will get back something like 55% of the money the company took from me in the first place.
And this says nothing about the economically devastated dealers and their employees, the independent gas station owners who installed soon-to-be-abandoned diesel pumps, and all the other people harmed by the deceit.
Who goes to jail for this, eh? Nobody again?
Volkswagen ripped off the entire planet for seven years, and now it’s ripping off unwitting dupes like me. Da da da.
