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STATEMENT BY VOLKSWAGEN GROUP OF AMERICA
Volkswagen and VW-Branded Franchise Dealers in the U.S. Reach Agreement in Principle to Resolve Diesel Litigation
Herndon, VA – August 25, 2016
Volkswagen Group of America, Inc. (“Volkswagen”) today announced it has reached an agreement in principle to resolve the claims of VW-branded franchise dealers in the United States relating to TDI vehicles affected by the diesel matter and other matters asserted concerning the value of the franchise. Volkswagen has agreed to make cash payments and provide additional benefits to the dealers to resolve alleged past, current and future claims of losses in franchise value. Volkswagen and the dealers’ counsel will now work to finalize details of the proposed settlement, including how to apportion payments to dealers in the appropriate manner.
Details of the agreement in principle are still under discussion and are expected to be finalized at the end of September. Any proposed agreement will become effective only after approval by the Court, and the parties have agreed to keep further terms confidential as they work to finalize the agreement. Under the agreement, Volkswagen will consent to the certification – for settlement purposes only – of a class of VW-branded franchise dealers in the United States as of an agreed date.
“We believe this agreement in principle with Volkswagen dealers is a very important step in our commitment to making things right for all our stakeholders in the United States,” said Hinrich J. Woebcken, CEO of the North American Region, Volkswagen. “Our dealers are our partners and we value their ongoing loyalty and passion for the Volkswagen brand. This agreement, when finalized, will strengthen the foundation for our future together and further emphasize our commitment both to our partners and the U.S. market.”
Steve Berman, Managing Partner of the dealers’ counsel Hagens Berman, said, “Our clients recognized the best solution would be one that not only allows them to recoup lost franchise value and continue to employ thousands of American workers, but one that also charts a strong course for the recovery of the Volkswagen brand in the United States.” Berman added, “Now that there is a path forward for dealers, they can continue to work proactively to take great care of their customers, who are also VW customers.”
The plaintiffs filed the initial complaint against Volkswagen on April 6, 2016, in the U.S. District Court for the Northern District of Illinois. The litigation was subsequently transferred to the multidistrict proceedings in the U.S. District Court for the Northern District of California.
About Volkswagen of America, Inc.
Founded in 1955, Volkswagen of America, Inc., an operating unit of Volkswagen Group of America, Inc. (VWoA) is headquartered in Herndon, Virginia. It is a subsidiary of Volkswagen AG, headquartered in Wolfsburg, Germany. VWoA’s operations in the United States include research and development, parts and vehicle processing, parts distribution centers, sales, marketing and service offices, financial service centers, and its state -of-the- art manufacturing facility in Chattanooga, Tennessee. The Volkswagen Group is one of the world’s largest producers of passenger cars and Europe’s largest automaker. VWoA sells the Beetle, Beetle Convertible, CC, Eos, e-Golf, Golf, Golf GTI, Golf R, Golf SportWagen, Jetta, Passat, Tiguan and Touareg vehicles through approximately 652 independent U.S. dealers. Visit Volkswagen of America online at www.vw.com or media.vw.com to learn more.
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