Photo courtesy of Volkswagen.

Photo courtesy of Volkswagen.

Motorlease Corp. will allow its lessees of Volkswagen diesel vehicles to return the vehicles without penalty by waiving early termination fees and excess mileage charges, the fleet management company said.

Earlier this week, U.S. District Judge Charles Breyer approved terms of a $14.7-billion settlement between Volkswagen and environmental regulators that will set up a program allowing eligible owners of 2.0L TDI vehicles to sell the vehicles back to the automaker.

Fleets who are using Volkswagen diesels now face essentially two choices. They can turn in the vehicle to Motorlease without penalty or hold onto the vehicle and hope Volkswagen can prepare an emissions modification, said Jeffrey Perkins, Motorlease's general manager of fleet operations.

"While Volkswagen has not yet submitted a proposal, they still have the opportunity to do so until the last deadline is reached on Oct. 30, 2017," Perkins said. "In the event fleets elect to wait and no modification is approved, class members can still participate in the buyback program, however vehicles averaging 12,500 miles or more annually will experience a decrease in the buyback adjustment calculation which will continue to grow as more miles are added."

Fleets who don't want to operate vehicles outside of complaince with EPA emissions standards are expected to opt for the buyback program.

"Fleets still running these vehicles will have to calculate what’s important to them and make a decision," Perkins said. "For some, the high-efficiency of TDI engines and hopes of an EPA- and CARB-approved emissions modification will warrant the first approach. For others, financial considerations and environmental concerns will take precedence and they'll elect the latter."

Other fleet management companies have been discussing possible outcomes with their clients.

"While it is not a large number, ARI has been actively communicating with our clients who may have affected VW vehicles as part of their fleet since the issues with the TDI diesels first came to light," said Partha Ghosh, ARI's director of supply chain mnagement. "This included notifying the drivers of active, impacted units that they must retain ownership of their vehicle until the settlement proposal was approved in order to be eligible for compensation. With the decision by the U.S. district court, we intend to assist our clients with their desired resolution based on the available options resulting final outcome of the VW settlement."

Originally posted on Automotive Fleet

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