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Volkswagen ordered to pay customers who took loans to buy altered cars

BUSINESS
By Reuters | April 13th 2021
Volkswagen Golf is one of the carmaker’s popular models. [File, Standard]

Volkswagen must fully compensate customers who took out loans to buy diesel cars that were discovered to be fitted with devices to cheat emissions tests, a German court has ruled.

The Federal Court of Justice in Karlsruhe on Tuesday dismissed the German carmaker’s appeal and said it has to pay 3,300 euros (Sh419,000) to a customer who bought one of its diesel cars in 2013, including interest payments on the loan.

“The buyer must be provided for as if the purchase had not happened,” judge Stephan Seiters said.

The case at Germany’s highest civil court is one of several faced by the world’s second-largest carmaker as it seeks to draw a line under the 2015 emissions cheating scandal, dubbed dieselgate.

Volkswagen has so far incurred more than 32 billion euros (Sh4.1 trillion) in costs as a result of the scandal.

Tuesday’s case was brought by a customer who purchased a used VW Golf with a loan from VW Bank, a subsidiary of the carmaker. After the diesel scandal emerged, she returned the car, which used the EA 189 engine at the heart of the test cheating crisis, and claimed damages.

Volkswagen, which had been unwilling to repay interest charged on the loan, said Tuesday’s verdict could not be applied to all vehicle purchases that received financing.

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