I think they are hard at work figuring out how to boost the performance of the engine while running in compliant mode. Assuming they can't get blood out of stone, I think everyone will get a firmware update for the ECU and wind up with negative consequences. There will then be class action suits in every state and by every state attorney who is running for office, and they would then settle those in a few years for hundreds of millions of dollars and as you say, the lawyers will keep the money. And the owners will be given a one year extended warranty or $50 repair voucher or some such thing. Meanwhile depreciation will set in big time on these cars and selling them will become hard.
What would be the more pro-consumer solution? Offer to buy off the cars toward purchase a new car at very attractive trade in value. Offer white glove service by bringing the car to people's homes and taking the old away. It would keep the customer with them and make them happy with a new car. Offer 0% interest so that people can afford to finance the differential.
Another alternative is to offer $2000 cash to make up for the lost value and performance. This would make it hard to find people who still want to joint he class action and sue them because they would have to think they can make more than this.
