NEW YORK (AFP) - Volkswagen is close to a deal to pay US$2 billion (S$2.9b) to settle a US criminal investigation into the emissions-cheating scandal involving its diesel cars, the New York Times reported on Friday (Jan 6).

A settlement between the US Department of Justice and the German auto giant could come as early as next week, the newspaper said, citing three people who were not identified.

Volkswagen told AFP it was continuing to cooperate with US authorities to resolve the case.

Volkswagen admitted last year it had installed software on as many as 11 million diesel vehicles sold worldwide to circumvent tests for emissions while enabling them to release up to 40 times the permitted amounts of nitrogen oxides during actual driving.

Volkswagen has already settled civil charges in the scandal, agreeing to pay US$14.7 billion in an agreement that permits owners of nearly a half million 2.0-litre diesel vehicles to either sell them back or get them fixed.

Last month, the company announced it reached an additional US$1 billion civil agreement with US authorities for a similar on deal covering 80,000 3.0-litre diesel vehicles. However, that agreement has yet to be approved by a judge.