VW to Settle U.S. Mileage Claims for $97 Million

Volkswagen AG says it has reached an agreement to settle a class-action lawsuit in the U.S. over inflated fuel economy ratings for 2013-2017 model cars.

The pact, which awaits court approval, would cover 98,000 gasoline-powered vehicles, or fewer than 4% of cars sold by VW Group during the period. The company says the proposed settlement aims to avoid prolonged litigation and does not include any admission of liability or wrongdoing.

The U.S. Environmental Protection Agency says VW used software on certain Audi, Bentley, Porsche and Volkswagen brand vehicles to manipulate automatic gear shifts. The software maximized fuel economy during certification tests but not in real-world driving.

Owners sued the carmaker over ratings that were 1 mpg greater than they should have been. VW says the plaintiffs will be eligible to collect payments ranging between $5.40 and $24.30 for each month they own or lease their affected vehicles.

The agreement also will result in a forfeit of the greenhouse gas credits the company gained because of the discrepancy in reported fuel economy. This portion of the settlement is pending EPA approval.