Volkswagen AG will offer credit cards worth $1,000, of which half is to be spent at VW and Audi dealerships, to U.S. owners of certain diesel models that do not comply with government emissions standards, VW's U.S. subsidiary said on Monday.
The automaker said eligible U.S. owners of nearly 500,000 Volkswagen and Audi models equipped with 2.0 liter TDI diesel engines can apply to receive a $500 prepaid Visa card and a $500 dealership card, as well as three years of free roadside assistance services.
The program could cost VW nearly $500 million, half of which could flow directly to dealers.
The German automaker has been embroiled in a scandal that erupted in September when it admitted it had rigged U.S. tests for nitrogen oxide emissions. The crisis deepened last week when it said it had also understated the carbon dioxide emissions and fuel consumption of vehicles in Europe.
VW also said on Monday it continues to discuss potential remedies with U.S. and California emissions regulators, including the possibility that some of the affected cars could be bought back from customers.
In Washington, Democratic Senators Richard Blumenthal and Edward Markey on Monday decried VW's consumer program as "insultingly inadequate" and "a fig leaf attempting to hide the true depths of Volkswagen's deception."
The senators said VW "should offer every owner a buy-back option" and "should state clearly and unequivocally that every owner has the right to sue."
VW has said about 482,000 cars sold in the United States since 2009 with four-cylinder diesel engines had software installed that allowed the engines to pass government tests for smog-forming nitrogen oxide emissions, but pollute at levels far above government limits in normal operation.
On Monday, the automaker posted details of its "goodwill package" at www.vwdieselinfo.com. Audi plans to post details of a similar program on Friday.
VW said the customer offer did not cover models equipped with the 3.0 V6 TDI diesel engine, including the Touareg. The company last week told U.S. and Canadian dealers to stop selling certain of those models from 2014-2016 after the U.S. Environmental Protection Agency said that VW group brands had installed illegal devices on some 3.0 V6 diesel models.
To qualify for the credit card offer, VW diesel owners must go to the company website, enter a vehicle identification number and provide mileage and contact information. VW will send the cards by mail. To activate the cards, owners then must take the vehicle to the dealer for verification.
VW said on Monday that customers "don't have to sign anything" and will not be required to relinquish any legal rights.