Volkswagen faces first-ever class action lawsuit in Germany over diesel emissions fraud

Some 470,000 diesel car owners in Germany are seeking refunds from Volkswagen over emission tests cheating. Hearings began with the automaker rejecting the judge’s call to settle the case, citing a lack of legal grounds.

The scandal, which has already cost the German carmaker $32.7billion (€30bn), first broke in 2015 when US regulators showed that the company had installed so-called defeat devices in its diesel cars. The software enabled the vehicles to perform within emissions limits during tests, while exceeding the limits during normal driving conditions.

The company has since faced class action claims from US and Australian consumers, now joined by Germans, who until last year could not pursue group claims. The current class action was made possible after Germany changed legislation in 2018, granting permission to consumer protection organizations to undertake court actions on behalf of consumers.

VW has repeatedly rejected the aim of the lawsuits launched against it, stating that despite the fact that its vehicles were indeed cheating during tests when first produced, the cars remained perfectly functional, while software updates have long since fixed the problem.

The vehicles are driven by hundreds of thousands of customers every day, which is why we believe there is no damage and therefore no cause for complaint,” the German carmaker has said.

Volkswagen’s settlements so far include a deal to buy back 500,000 cars in the United States for over $25 billion, as well as an agreement with Australia, where the company will pay 127 million Australian dollars ($86mn) in compensation.

However, the car manufacturer said on Monday there was no legal basis for consumers in Germany to seek compensation for their cars due to differences in law. Some 2.4 million cars with defeat devices were on German roads when emissions cheating was first revealed. 99 percent of them have by now received a software update, according to the company.