Volkswagen has recalled around 90,000 Australian vehicles, amid a scandal over its use of dodgy software to cheat emissions tests.

Local legal action is now expected, with compensation law firm Maurice Blackburn saying “a consumer class action is almost certainly now the only avenue for redress”.

The lawyers say VW’s recall does nothing to address compensation concerns from car owners.

“Today’s announcement from VW had failed to provide any clarity on how it is intending to compensate consumers who might lose thousands of dollars in increased running costs or reduced re-sale value for affected vehicles,” Maurice Blackburn class actions principle Damian Scattini said.

The scandal has dealt an unprecedented blow to Europe’s largest auto manufacturer, which has indicated it will take a €6.5 billion ($US7.33 billion) charge to earnings to cover the cost of repairing up to 11 million vehicles onto which it installed the scam software.

Maurice Blackburn says it has been contacted by almost 700 people around Australia ahead of a potential class action, and it expects the discontent will not stop there.

“Today’s announcement reveals that the scope of people affected in Australia is much larger than was first thought, and in our view a class action is now most likely,” Mr Scattini said.

Consumer watchdog the ACCC says an enforcement investigation into Volkswagen is a priority, and it may take action if it finds consumers were exposed to misleading representations.

The use of emissions test defeat devices is of course prohibited under design rules in Australian consumer law safety standards.

Breaches of the law carry a maximum penalty of $1.1 million, so paying out the full amount for every car would cost Volkswagen billions of dollars.

“It beggars belief that VW got itself into this situation in the first place but it adds insult to injury for the company not to address the issue of compensation to vehicle owners,” Mr Scattini said.

“The class actions mechanism is the best chance people have of holding companies that have caused mass wrongdoing to account.”