Volkswagen to cough up $6 billion
Volkswagen says it has negotiated a US$4.3 billion (NZ$6 billion) draft settlement with US regulators to resolve its diesel emissions troubles and plans to plead guilty to criminal misconduct.
The guilty plea is part of the civil and criminal deal as the German carmaker looks to restore its tarnished global brand. Volkswagen said with the addition of the fine, its diesel costs will exceed the nearly 18.2 billion euros it has set aside to handle the problem.
VW also said it will face oversight by an independent monitor over the next three years.
Reuters reported earlier the company's supervisory board is set to meet to approve a civil and criminal settlement with the US Justice Department over the automaker's diesel emissions.
VW said the supervisory board and the management board would meet within days to approve the deal.
VW is expected to plead guilty as part of the settlement as early as Thursday, a source familiar with the matter said.
The plea deal will need the approval of a US judge.
Evercore ISI said in a research note it believes the "settlement is intended to draw a line under all remaining US related legal risk. This is good news."
VW had raced to get a deal done before President Barack Obama leaves office on January 20. A change in administration could have delayed a final settlement for months if not longer.
"The most important news is that VW managed to come to an agreement that allows the company to move on from here. It's a major relief that this doesn't get dragged into the new US administration," Evercore ISI said.
VW admitted in September 2015 to installing secret software in hundreds of thousands of US diesel cars to cheat exhaust emissions tests and make them appear cleaner than they were on the road, and that as many as 11 million vehicles could have similar software installed worldwide.
On Monday, a VW executive, Oliver Schmidt was accused of conspiracy to defraud the US over the company's emissions cheating and the carmaker was accused of concealing the cheating from regulators.
The Justice Department settlement with VW will not end the Justice Department's investigation into individual misconduct and more executives may face charges, sources said.
VW still must spend the next two years buying back or fixing dirty US vehicles and faces unresolved lawsuits from US investors and about 20 US states.