AUTOS

Judge gives Volkswagen one month to plan diesel-emissions fix

A federal judge Thursday gave Volkswagen and environmental regulators another month to devise a plan for fixing or removing nearly 600,000 diesel cars in the United States involved in Volkswagen’s emissions-cheating scandal.

U.S. District Judge Charles Breyer in San Francisco asked for a proposal by April 21.

At a hearing, Breyer said he was told by Robert Mueller, a former director of the Federal Bureau of Investigation who has been meeting with the parties, that Volkswagen and the regulators have made “substantial progress” in reaching a solution.

Volkswagen issued a statement saying it is committed to finding a fix “as quickly as possible and to implementing a solution for affected vehicles, as we work to earn back the trust of our customers and dealers and the public.”

“We continue to make progress and are cooperating fully with the efforts undertaken by Judge Breyer, working through Director Mueller, to bring about a prompt and fair resolution of the U.S. civil litigation,” the German automaker said.

Breyer is presiding over hundreds of class-action lawsuits filed against Volkswagen, which also faces fines and penalties from the U.S. Environmental Protection Agency, the California Air Resources Board and others, which combined could total in the tens of billions of dollars.

The scandal erupted in September when Volkswagen admitted that it had installed so-called cheat devices on diesel-powered cars from 2009 through 2015 so that their engines would emit fewer pollutants during emissions tests than during normal road use.

The cheating involved about 11 million cars worldwide. Of the U.S. market's nearly 600,000 affected cars, about 70,000 are in California.

Fallout from the scandal has hit Volkswagen hard and left its U.S. dealer base extremely anxious. That prompted Volkswagen executives in Germany last week to reaffirm the company’s commitment to the U.S. market during a meeting with the dealers.

The automaker’s sales in the second half of 2015 fell as much as 25% in some parts of the nation, mainly because — without EPA approval — the automaker was forbidden to sell new and certain certified-used diesel cars, which typically account for about 25% of overall sales.

In addition, the company’s top U.S. manager, Michael Horn, left the company earlier this month.

Karl Brauer, senior analyst at Kelley Blue Book, said Volkswagen “can't move past its diesel challenge until a solution is confirmed for all cars that don't meet [the] current standard.”

“While any fix for these vehicles will be complex and costly, every delay extends the time frame to get past this scandal and on to rebuilding the brand,” Brauer said.

Kathryn Phillips, head of the Sierra Club’s California Chapter, said in a statement that Volkswagen’s “polluting vehicles need to be fixed or taken off the road and the consumers who trusted they were buying less-polluting cars need to be compensated. Period.”

For more business news, follow James F. Peltz on Twitter: @PeltzLATimes

Copyright © 2016, Los Angeles Times

UPDATES

12:18 p.m.: This article was updated with staff reports.

This article was originally published at 9:48 a.m.

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