DETROIT - In the latest example of Volkswagen of America Inc.'s quality woes, the automaker is warning 426,000 VW Passat and Audi A4 owners of an engine oil sludge problem.
Affected are 1.8-liter turbocharged four-cylinder engines on 1998 to 2004 Passats and 1997 to 2004 A4s. VW won't say how many engines have been replaced or repaired, or what it is spending to fix the problem.
Owners began receiving letters from VWoA this month. Remedies range from extending warranties to covering repair costs. That includes replacing engines.
Sludge buildup causes engine performance to deteriorate. In extreme cases, sludge can cause engines to seize.
The timing couldn't be worse. VW Division has old products, and sales are down 11.5 percent for the first seven months compared with the year-ago period. And it has only been a year since VW voluntarily recalled more than 500,000 vehicles because of faulty engine ignition coils.
VW is not alone in grappling with engine oil sludge complaints. Last week the Center for Auto Safety in Washington demanded that the Chrysler group fix sludge problems and extend warranties on 2.7-liter V-6 engines in its 1998 to 2002 vehicles.
Confirming that VW has received "numerous reports of problems," VWoA spokesman Tony Fouladpour said that VW is extending factory warranties from five years to eight years. Warranties are transferable.