Volkswagen and Audi Oil Sludge

1.8L 4-cylinder Turbocharged Engine

From 1997-2005, VW manufactured a 1.8-liter turbocharged engine with a tiny 3.7 quart oil capacity. That’s simply not a lot of oil to compensate for the amount of heat this engine generates. In fact, many mechanics and owners say it eliminates any margin of error for owners who are a bit late on an oil change, or those that mostly do short-trip driving.

Turbochargers are hot. When that heat has nowhere to go, it starts breaking oil down faster. VW did install “oil coolers” in these engines, but from what we’ve heard they don’t do much. Well, unless you consider how they leak.

Make Model Years Engine
Audi A4 1997-2004 1.8L 4-cylinder Turbo
Volkswagen Passat 1998-2004 1.8L 4-cylinder Turbo

There are certain oils that could handle engine heat better, but they’re most expensive and owners are often never informed they need it. Or, it’s often too late.

When oil sludge builds up it will damage the engine, leaving owners with repair bills anywhere between $4000 and $8000.


Extended Warranty

Volkswagen acknowledged the sludge problem in 2004 when they extended the warranty on some cars to 8 years / unlimited mileage. They also promised to help customers who had already paid for repairs, but only if they could provide adequate documentation showing perfect maintenance records.

Accidently shred one of your oil receipts? Decide to change your own oil to save a few bucks? Then VW would almost certainly deny your claim.

Len Hunt, who was the vice president of VW at the time, said he thought the requirement were too strict1:

“When you’ve got a reputation for not such stellar quality, you’ve to treat the customer properly. Sometimes your rules and regulations and the culture of the company can be a little bit harsh when it gets translated down to the customer level.”

VW eventually eased up on their restrictions, but it wasn’t enough.


Class-Action settlement

Volkswagen Group of America reached a settlement agreement for a class-action suit back in 2010. The lawsuit said that 500,000 VW and Audi vehicles are prone to sludge-damaged engines. It also says that VW committed fraud by telling owners it was their fault for not changing the oil enough.

VW denied any wrongdoing, despite agreeing to settle.

The settlement says that VW will pay at least 50% of the cost to fix the engines on the following vehicles with 1.8-liter 4-cylinder engines:

  • 1997-2004 Audi A4 (sedan, wagon, and convertibles)
  • 1998-2004 VW Passat

Settlement Provisions

  1. VW will compensate owners 100% of the repair costs if the owner can prove that the last two oil changes, prior to any sludge, were performed within the recommended mileage and timeframe.
  2. VW will compensate owners 50% of the repair costs if the owner cannot provide proof of the last two oil changes prior to any sludge.
  1. From a 2005 interview with The Plain Dealer of Cleveland. source