My uninformed assessment of how we got here
In the dearth of actual information, and until the tell-all books come out a few years from now, we're left to speculate what is going on and how we got to Tuesday's agreement. I would like to offer my uniformed assessment.
1. Breyer's pressure to settle cannot be understated. While his public statements are bland, behind the scenes he is making it VERY clear to stakeholders he does not want to try this case. He has immense power in this regard to make it difficult for whichever stakeholders he feels is impeding settlement.
2. Everyone knows big $ must change hands. VW wants to minimize, naturally. Shrewdly, to pay $millions rather than $billions, it is targeting its money as offers that cannot be refused. Thus, $millions for CARB/EPA and public-appeasing distractions like "environmental remediation funds."
3. Steering committee has heard our demands that all 3.0 owners be offered buy-back option. VW, wishing to pay $millions rather than $billions, refused. This became a, if not the, huge impediment to settlement.
4. Through strategic leaks VW has "informed" the press that it has an easy software fix for Gen2 3.0s. It says it's already done, and can roll it out immediately. Steering committee is unconvinced, since VW's previous two fixes were rejected by CARB/EPA and, well, it's VW. Standoff.
5. Breyer applies more pressure. Compromise agreement results, released Tuesday. It says, in essence:
- "VW, you claim you have a fix you can roll out immediately? Fine. We
expect it in CARB/EPA's hands by February 2017, and it better be
final by April 2017* [Table, Appendix B at 23]."
- "VW, if you are telling the truth, and you have a fix CARB/EPA will approve for the Gen2 vehicles, we're not going to make you offer buy-backs on those. You will, though, have to pay a bribe to get >85% of the Gen2 owners to submit to your fix."
- "VW, if you are not telling the truth, and you cannot deliver by the deadline a fix that CARB/EPA will approve for the Gen2 vehicles, you are going to offer buy-backs to all Gen2 owners at November 2015 retail."
This is how the compromise was reached. The steering committee, faced with pressure from Breyer plus VWs intransigence on Gen2 buybacks based on insistence that the fix would "work", had to cave in and give VW a short window to deliver on its representations.
Which leads to my ultimate cynicism about the deal. Whether we get a Gen2 buy-back option is 100% in CARB/EPA's hands. These are the same hands that just accepted $millions from VW. I suspect there is "an understanding" that, by accepting VW's $millions, CARB/EPA has agreed that VW's fix will be acceptable, thus saving VW $billions. CARB/EPA rationalizes this because it knows that, in the big scheme, 63,000 Gen2 3.0s produce little dirty fumes anyway, and the "remediation funds" will be used to clean more air than buying back Gen2 3.0s would.
As to the Gen2 3.0 owners? By definition, since we own 2013+ Porsches, Audis and VWs, we're rich, we can afford it, right?
*These dates on the table differ depending on which Gen2 is involved...
