This is a very similar engine to the EA888 Gen3 found in a lot of other Golf/Jetta model of cars. The biggest difference is this engine is a Budack cycle engine. Which is more fuel efficient and has slightly less power when compared to the EA888 Gen3. This is not a replacement for the Gen3 just an alternative base on the needs of the car. Its commonly found in the MK2 Tiguan in the US. Due to the similarity to the EA888 Gen3 it has most of the same issues.
Engine valve buildup:
Just like any direct inject engine that doesn’t have multi port injection or something similar to clean it, this engine gets carbon buildup over time. Because of the way the fuel injection works the gunk can buildup overtime on the valves by oil and junk flowing through the PCV system to the valves. to the left is a picture of what valves can look like overtime. Europe did get MPI (multi port injection) on the EA888 Gen 3 engine but sadly this feature did not make it over to the US.
Loss in performance is a sign that this might be happening. But that is also a very vague sign that could be the result of a lot of things.
If you already have buildup the best way to resolve it is take it apart and clean it. This is a very time-consuming task or expensive if you have a shop do it. You could try using a cleaning solution like Seafoam or BG Induction Cleaning that doesn’t require taking everything apart.
Another option is to install a catch can. This will catch the foreign contaminates in the PCV system before they get to the valves. You will need to empty the catch can every so often. A good time is when you do your oil changes. Another option is the “Italian tuneup” which is running your engine at higher RPM’s occasionally to burn off any buildup you engine has. If you are a spirited driver this may not be necessary but for those conservative/commuters this can help.
The best thing you can do to prevent buildup is use higher end gas and try not to do short drives. The cheap gas has less cleaning additives that don’t help this situation and shorter drives dont allow the engine to heat up enough to burn off anything that might build up on the values. The old Italian tuneup is something other recommend for that reason.
Here is a discussion on this issue: http://forums.vwvortex.com/showthread.php?8009609-Carbon-Buildup-on-MK7-s&p=97730409&viewfull=1#post97730409
First before you get too scared this issue is not common, I almost didn’t even add this due to how rare it is.
Typically the failures are due to bearings failing, the turbine shaft isn’t balanced well enough and becomes wobbly and then the turbine fins get shredded. Some people when upgrading their turbo or replacing it are sending it off to a shop the specializes in turbos to get the shafts balanced before installing it.
Oil filter housing:
The oil filter housing is plastic and it is very easy to crack by over-tightening or not taking it off correctly. As with the previous generations of these engines a metal version of the housing has come on the market by a third-party and although this sounds like a nice solution it only causes a higher chance of stripping the plastic threads where it screws onto. Its much better to have an issues with the housing than where it connects to the engine block
Thermostat housing leak:
The thermostat housing can leak. Replacing it with the latest version is a good idea if you find your coolant is low or you smell coolant a often after drives. Please also note the coolant reservoir is under pressure and when you remove the cap the level of coolant may rise. So remove the cap on the tank when checking its level. Its also important to use the OEM coolant and follow the instruction on the container when filling. G13 coolant is what the OEM uses, it should be a pink colored liquid. Dealers will do a pressure test to see if it passes, some leaking housing still pass their pressure test.
As with most VW forced induction engines the water pumps are a weaker point. They are not super common and dont break as often as older engine but still do occasionally. I have not seen a metal one available yet like older platforms, probably because the issue isn’t as common.
PCV system and oil:
Although the PCV systems doesn’t break causing loss of pressure like previous generations it does have a new issue. When the car has been under prolonged WOT accompanied by aggressive braking oil can be sucked into the intake manifold causing plumes of smoke.
What happens is the small check valve drain, normally used for emptying blowby not large amounts of oil into the pan, gets overwhelmed and oil gathers in the PCV. This causes pressure to build eventually causing extra oil to not go into the pan like it should but into the intake manifold. If this happens enough you will have build up problems.
That being said this issue is only cause under extreme conditions. Unless you are driving super aggressively on lets say a track or auto cross this issue likely wont come up for you. Solution right now are catch cans like the Spullen one that replace the front PCV system to handle the extra oil. I personally don’t want a catch can and am waiting for a more simple PCV fix. I also have only seen this issue happen twice on my car and have a feel for the conditions when it happens and will try to avoid it until a proper fix is released either by VW or third party. Likely third party in this case like the MK5 PCV fix.