U.S. Dieselgate bill now at least $25 billion.

Volkswagen and a federal judge have agreed a $1.22-billion (£940 million) fine for the carmaker’s 3.0-litre TDI engines fitted with a cheating device. The German manufacturer will have to either fix or buy back 80,000 vehicles in the United States equipped with the motor.

Volkswagen must pay between $7,000 and $16,000 (£5,400 to £12,400) to each owner of a 3.0-litre TDI car who decides to keep it and get it fixed by the company. The company could also be forced to pay up to $4.04 billion (£3.13 billion) if regulators don’t approve fixes for the 3.0 TDIs.

A spokeswoman for the company, Jeannie Ginivan, is quoted by Reuters as saying the settlement "marks an important milestone for Volkswagen and means that a resolution is available to all of our customers".

U.S. District Judge Charles Breyer approved the penalty less than a year after he approved another settlement for Volkswagen linked with the smaller 2.0 TDI engines. Last autumn, VW agreed to pay $14.7 billion and to fix or buy back 475,000 cars fitted with that engine – and more than half of the affected vehicles have already been repurchased or repaired.

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The same judge also granted German parts supplier Bosch a settlement, which says the company has to pay $327.5 million to owners of diesel Volkswagen vehicles in the United States for its role in developing the engines.

According to a recent report, Volkswagen could be forced to sell Ducati in order to cover all the expenses surrounding Dieselgate. Late last month, Reuters reported the German company is currently contacting potential buyers, but a final decision has not yet been taken.

Volkswagen also decided to axe the development of a new generation of small diesel engines and to replace them with hybrid systems. There will be no replacement for the current 1.6 TDI – instead, the money will be invested in new electric systems that will be used in the future hybrid powertrains.

Source: Reuters