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The "Check Engine" light or MIL (Malfunction indicator light) illumination, indicates a problem in the engine control system.
A steady light indicates a fault that may cause high engine or evaporative emissions. Under certain conditions the light will blink or flash. A blinking light indicates a severe level of engine misfire that can cause expensive component damage.
If the MIL is flashing, I advise you DO NOT drive it. Misfires on this year/model/engine are common. The most likely cause would be a coil. They are located under the black plastic cover on top of the motor. If it is a coil, they are fairly simple to replace and relatively inexpensive. I usually recommend replacing all 4 coils. If you want to take a chance you could simply replace all coils, but it may not correct the fault. There are other possibilities, but without ALL the specific Diagnostic Trouble Codes (DTCs), a description of the symptoms, when they occur, and how they developed, this is just a guess based on your description as this is BY FAR the most common cause of misfires and the storing of the P0300 series of DTCs.
Why is it that you susspect the cam sensor failure?
If the MIL is flashing, it's a pretty safe bet the coils will do it, but no guarantee's. I rate it a 3 on a 10 scale for difficulty to DIY replace.
The MIL will still be illuminated and must be cleared with a scanner. It should go out by itself, but it may take awhile. If it is still running poorly or flashing, there is another problem and further testing would be required.
I hope I have answered your questions and addressed your concerns. Should you have any further questions, please do not hesitate to ask.
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P0340 is for no signal from the cam position sensor. This is located on the front of the engine under the timing cover. You should see the electrical harness connector going to it. A failure or intermittent failure of this sensor could cause a "no start" issue, but could not be the cause of a misfire.
What are ALL of the DTCs you have retrieved?
Is the vehicle misfiring?
Is the check engine light flashing?
If you clear the DTCs, do they come back?
I will post this again as I do not see my last answer.
If the light is not flashing the misfire is not that severe and likely not a coil(s). Also, if all the P0300 codes are set, all the coils would likely not fail at the same time.
If the P0340 comes back as you state, I would inspect the wiring to the sensor, as well as the cam adjuster/tensioner located on the back of the cylinder head. If the wiring looked good, you could try replacing the sensor at the front of the cylinder head, but I can not guarantee that this will correct the issue.
Further diagnosis would require a VW/Audi scanner capable of accessing the various measuring blocks, and performing some system checks. Is your scanner one of these or simply a read codes and erase scanner? It also becomes much more complicated and I would recommend at that point to take the vehicle to a qualified repair shop that is familiar with the system.
There were some recalls on coils some time ago on the coils, but most have been performed by now. You can call Audi with your vehicle identification number at 1-800-822-2834 (AUDI), Mon-Fri, 8 am to 8 pm, Eastern Time. They can tell you if there are any outstanding recalls on your vehicle.
It could very well be 2 coils, you could swap #3&4 coils with #1&2 and see if the misfire moves. These coils are very sensitive to failure if they are not gently/evenly removed so go easy, If you have a failed coil, I recommend replacing all 4.
The vehicle is smoking badly? When did this start? It is very difficult for me to help you if you do not tell me EVERYTHING. The quality of my answer depends HEAVILY on the quality of your description. Please start at the beginning and tell me EVERYTHING to the best of your ability. I will go over your description and give you my answer.
BTW, if it's smoking badly remove the large intake boot at the bottom of the intercooler. If there is oil collecting here, your turbo oil seal has failed, and the turbo requires replacement.
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Jake "THE AUDI DOCTOR"