Why Volkswagen Drivers in Europe Are Still Waiting for a Diesel Emissions Deal

While a settlement was proposed in the U.S., European drivers are in the dark.

ByABC News
April 22, 2016, 2:46 PM
A Volkswagen logo is pictured at Volkswagen's headquarters in Wolfsburg, Germany, April 22, 2016.
A Volkswagen logo is pictured at Volkswagen's headquarters in Wolfsburg, Germany, April 22, 2016.
Hannibal Hanschke/Reuters

— -- While Volkswagen may have shown progress in resolving its diesel emissions issue for about 500,000 cars in the U.S., owners of millions of Volkswagen cars in Europe are still waiting for a settlement with the carmaker.

Volkswagen had previously announced that a software fix on European cars could begin in January, but repairs have still not begun. Meanwhile, Volkswagen customers in Europe are still waiting for news about whether the company will also compensate them.

"The fixes were supposed to be starting in January and it is now April," Bozena Michalowska, an attorney in London with law firm Leigh Day, which represents some of those VW owners, told ABC News. "Our clients feel that they are being treated with contempt."

Yesterday, U.S. District Court Judge Charles Breyer announced a settlement for owners of 482,000 VW models with two-liter diesel engines dating back to 2009. U.S. Volkswagen owners and the Justice Department filed suit against the automaker after it said in September that 600,000 of its cars in the U.S. have software that can cheat emissions tests. Volkswagen said about 11 million cars worldwide are affected, of which several million are in Europe.

Michalowska said she has been contacted by more than 9,500 Volkswagen drivers in the U.K. and may file a lawsuit in the coming weeks.

"Volkswagen's offer to buy back vehicles in the U.S. only will only make U.K.-based vehicle owners feel worse," she said. "Why are vehicle owners in the U.K. being treated differently? If anything, this will only strengthen their resolve to pursue redress."

Though Judge Breyer didn't offer specifics yesterday, he said the settlement will include the option for U.S. owners to have the automaker buy back their vehicles. The full details of the plan will be made public in June. Lawyers are still negotiating what to do with another 90,000 Volkswagen cars in the U.S. with three-liter diesel engines that also have the cheating software, The Associated Press reported.

"The majority of our clients chose their cars because of its environmental credentials," Michalowska said. "They are angry and believe that they have been lied to."

Volkswagen did not respond to a request for comment.

Why the delay for its biggest customer base: Europe?

"The explanation likely lies in the fact that VW has much more to fear from an institutional perspective from U.S. authorities than they do European governments," said Sebastiaan van Doorn, associate professor at Warwick Business School in the U.K.

While the U.S. has higher emissions standards, it could also levy heavy penalties or stricter recall procedures, van Doorn said. In Europe, potential arrangements may be more scattered, due to the differences between countries, he added.

Van Doorn said Volkswagen's cash position and cash flow won't realistically be able to compensate American and European drivers equally. While the U.S. deal concerns around half a million vehicles, a similar deal in Europe would have to cater to about 7 to 8 million vehicles, he said.

"It seems that Volkswagen believes that by satisfying U.S. authorities they take the sting out of the scandal, and they probably will succeed in that from a legal perspective," he said. "That, however, does not mean that the aftertaste of the anticipated unequal arrangements for U.S. and European customers will not linger and translate into sales slumps in years to come in their important European home market."

ABC News' Jeffrey Cook contributed to this report.