Volkswagen will soon offer to buy back 500,000 US Diesel vehicles

Volkswagen to buy back cars in US

Volkswagen and US officials have reached a framework deal that will allow the automaker to buy back 500,000 diesel cars that used sophisticated software to trick US. emission rules, two unnamed sources told FoxBusiness on Thursday.

The buy back affects 500,000 2.0-liter diesel vehicles sold in the United States.

The offer includes the Jetta sedan, the Gold compact, and the Audi A3 models sold since 2009.

The buyback offer does not apply to the bigger, 80,000 3.0-liter diesel vehicles also found to have exceeded US pollution limits, including Audi and Porsche SUV models, the sources told FoxBusiness.

Shares of Volkswagen increased by 6% to $30.95 following the news.

VW in September admitted cheating on emissions tests for 11 million vehicles worldwide since 2009, damaging the automaker’s global image.

The cheating scandal is expected to cost the company tens of billions of dollars. The company faces government and customer lawsuits, and fines from the EPA and other global agencies.

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In the US Volkswagen is expected to pay for the buy back and also start a compensation fund for customers that will cost more than $1 billion on top of the buy back costs.

Volkswagen may also offer to repair polluting diesel vehicles if US regulators agree to its proposed fix.

VW is refusing to comment on the buy back program at this time.

The company hired compensation expert Ken Feinberg to handle the deal. He was responsible for administering 9/11 funds and payouts for the BP Deepwater Horizon oil spill, among other high profile payout cases.