Volkswagen AG will pay $1.21 billion (£940m) in compensation to 652 dealers in the US as part of its $16.5bn (£12.8 billion) diesel emissions settlement.

This means dealers will get an average of $1.85 million (£1.4m) over 18 months under the settlement first announced in principle in August, reports Reuters this morning.

As part of the settlement, VW will continue making some incentive payments to dealers, buy back diesel vehicles that dealers can't sell and suspend capital improvements for two years. A federal judge must still approve the settlement.

The company, which has been barred from selling all diesel vehicles in the United States since late 2015, said earlier this month it is uncertain whether it will ever sell diesel vehicles in the United States again.

In September 2015 VW admitted using software-based defeat devices to cheat US emission tests.