The Federal Court has fined Volkswagen a record $125 million – $50 million more than the $75 million the German car maker had agreed upon with the Australian Competition and Consumer Commission (ACCC) – for making "false representations" about the diesel emissions of more than 57,000 cars.
It is the highest penalty ever handed down by the Federal Court for breaching Australian Consumer Law.
In the previous hearing in October, Justice Lindsay Foster had described the agreed penalty of $75 million as "manifestly inadequate", even though it was more than three times higher than the previous record fine.
Volkswagen had earlier admitted to manipulating the software on certain diesel vehicles to produce lower nitrogen oxide emissions during laboratory tests than when driving on public roads.
The previous record high fine under Australian Consumer Law was $26.5 million, awarded to training college Empower Institute in September 2019.
The previous highest fine for a car company in Australia was $10 million issued to Ford over gearbox problems April 2018. Supermarket giant Coles has also previously been fined $10 million and Telstra fined $12 million.
"Volkswagen's conduct was blatant and deliberate," said ACCC chair Rod Sims in a media statement.
"This penalty reflects a trend of ever-higher penalties for breaches of Australian consumer law."
A statement from Volkswagen Germany said the company is considering appealing the decision, having earlier "agreed in principle" to a $75 million fine with the ACCC.
The Volkswagen statement said it considered the original $75 million fine was a "fair amount" and that it is now "carefully reviewing the court's reasons for deviating from that amount".
The statement from Volkswagen Germany continued that it "will determine in coming weeks whether it will appeal the decision of the court".
Today's ruling by the Federal Court imposes a penalty on Volkswagen head office in Germany. The case against Volkswagen Group Australia had been dismissed.
The case against Audi, which shares the same diesel engines as Volkswagen, had also been dismissed.
Meanwhile, further class action proceedings against Volkswagen – over certain diesel models – are currently scheduled to be heard by the court on 26 March, 2020.
In the original "dieselgate" recall more than 90,000 Volkswagen, Audi, and Skoda cars with EA189 diesel engines were affected.