Volkswagen's wallet has been getting progressively lighter lately, thanks to fines and penalties from Dieselgate (VW owes $86 million to the state of California alone) and a recent $14.7 billion settlement with the U.S. government from the same scandal. But the embattled automaker has gotten a slight reprieve, as the German government has decided not to fine VW. They will simply be required to fix all faulty diesel engines.
Bloomberg News reported that while the German Transport Ministry is not requiring VW to pay any reparations, it is requiring the automaker to repair all affected vehicles to a legally compliant condition. This has drawn the ire of many of the Germans who have also been affected by VW's emission-fixing scandal and feel they are being treated as "second class."
The biggest reason for this action is because Europe doesn't specifically ban the switch-off-style "defeat devices" used by Volkswagen, but allows them to be used to help protect the engine. There is also a great disparity between the legislative systems in the U.S. and the European Union. "The lack of class-action lawsuits is a major disadvantage for European customers, undermining their leverage in negotiations," according to Automotive News.
Stefan Bratzel, director of the Center of Automotive Management at the University of Applied Sciences in Bergisch Gladbach, Germany, said that "there is an attempt to protect Volkswagen to a degree, as (they) could be pushed to a breaking point if the same criteria applied in Germany as in the U.S."
VW sold some 8 million diesel-powered cars in Europe, which had they been fined in the same manner they were in the U.S. (fines that could have totaled around $100 billion), they would more than likely have been forced into bankruptcy. So the German government decided showing some sympathy for one of their country's biggest employers.
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