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Volkswagen to offer generous compensation to diesel owners, newspaper reports

Head of fund says he expects most owners to accept what will be offered By ,

Owners of Volkswagen Diesel vehicles will receive generous compensation packages from the company, Reuters reports, citing a German newspaper article.

In the article, the head of Volkswagen’s claims fund told the paper that the roughly 600,000 owners in the U.S. will be compensated for owning vehicles that are emitting higher emissions than claimed.

The articles do not mention what would happen for Canadian owners.

Kenneth Feinberg, who administers the fund, told the paper that the automaker has not yet decided what form of compensation will be offered, whether it is cash, a car buyback, repairs or replacing their vehicles.

Feinberg has previously managed compensation funds for victims of Sept. 11, the BP Deepwater Horizon oil spill and the ignition switch scandal at General Motors.

The German carmaker is still struggling to find a way to fix any vehicles to the satisfaction of authorities after admitting to cheating on emissions testing on some of its diesel models.

The original plan was to set up a claims fund within 60 to 90 days, but that could be delayed as VW and regulators struggle to reach a deal.

When the fund does get set up, Feinberg believes the majority of people will accept the compensation offer, he told the newspaper.

The development follows news Friday that the state of New Jersey has launched a lawsuit against Volkswagen over the scandal.