Aussie Volkswagen owners still waiting

The head of Volkswagen has apologised to shareholders regarding the emissions cheating scandal, but Australian owners of the group’s vehicles are still waiting for compensation, as  has been meted out to comparable drivers in the United States.

Legal firm Maurice Blackburn is leading one of two Australian class actions against the Volkswagen Group, and the Australian Competition and Consumer Commission (ACCC) is investigating, but the car company says Australians are not owed any reparations because VW did not break any local laws.

The legal dispute also includes Skoda and Audi models built by the motoring giant. The scandal has affected 11 million cars throughout the world.

In early July the Federal Court asked VW to provide more information about how the software works to the lawyers representing almost 100,000 owners of VW, Audi and Skoda cars with diesel engines that cheat emissions tests. It is the third time VW has been asked to provide more material.

In April, Justice Foster accused VW of treating Australia as a ‘backwater’ for not providing the required documents.

In June the VW Group agreed to pay an average of US$5,000 (AU$6,600) to US owners of vehicles fitted with software that can cheat diesel emissions tests. The company will also buy back almost 500,000 vehicles in the US. The entire package is reportedly worth $15 billion.

However, despite admitting that it has sold 100,000 cars with the same software in Australia, the company is arguing that it did not breach any local laws.

Volkswagen Australia Managing Director, Michael Bartsch, said there were no regulations in Australia or elsewhere requiring the company to meet real-world driving emissions tests.

“The reality is that no manufacturer is required to provide emissions data based on real-world driving performance,” Mr Bartsch said in April.

The lawyer leading the class action, Maurice Blackburn’s Jason Geisker, has met with international engineers to discuss technical issues.

“They’re trying to suggest to consumers that once they’ve passed the test in the laboratory, the vehicles can operate completely differently on the open road and that there’s no contravention,” Mr Geisker said.

“For year after year these companies banked profits from selling so-called ‘clean’ diesel cars, but they now refuse to compensate any Australian motorists. This is simply not good enough.”

The company says it is working with the Federal Government regarding what it calls ‘a technical solution’, in which it would update the software free of charge.

At the Volkswagen Group’s AGM in June, CEO Matthias Mueller apologised to shareholders.

“I apologise to you shareholders for your trust in Volkswagen being betrayed,” he said.

“This misconduct goes against everything that Volkswagen stands for.”

The full cost to the company is yet to be calculated, with lawsuits from customers and shareholders and regulatory fines from various jurisdictions still pending. VW’s share price plunged 40 per cent after news of the scandal broke in September last year. It has recovered somewhat, but is still down 26 per cent.

Mr Mueller claimed the scandal had created an opportunity for VW.

“It forced us to strengthen and speed up overdue changes and to set new priorities,” he said.

One of those changes could be abandoning diesel engines altogether.

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