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Fender and wheel well arch rust TSB and repair on VW
Rust on the fender and wheel well arches on your Volkswagen Jetta TDI
A common problem is rust on the fenders on VW Jetta TDI, VW Golf TDI, and other models. This is caused by rubbing and should be covered by the rust warranty.
Difficulty: 1/5 if it's not bad
Volkswagen put soundproofing in the front wheel wells of the mk3 (mark 3, 3rd generation), mk4, and mk5 TDI to help absorb noise. Unfortunately, it also absorbs moisture and road salts and can cause paint flaking at the top of the fender arch. They issued a technical service bulletin for the mk4 because it seems to be a common problem. The mk3 and mk5 also have this soundproofing in the exact same place but it appears to not be as common.
The official fix is to trim back the foam or repaint/replace the fender if it's already rusted. If you want to trim the foam, this is only a difficulty of 1/5. If the paint is a little flaked off, I first suggest taking it to the dealer. The good news is that many dealerships will repair this for free but some may refuse. Print out the TSB below or contact VW of America for support. There are many reports of dealerships repairing it free of charge, even after very high miles and being out of regular warranty for a long time.
If they refuse the repair and you decide to DIY repair a tiny rust spot: pull back the wheel liner, trim the foam, spray some rust stopper, and apply touch up paint to the area. Once you touch it, they may decide to not honor the rust warranty by saying you tampered with it. See the FAQ for paint codes to find your color touch up paint. It often shows up on the driver's side first. My best guess is that the car leans to one side from the driver's weight, causing drippings to collect on that side more, or that road salts and crud accumulated on the left side of the road are picked up by the tire.
VW's 12 year/unlimited mileage rust warranty normally does not cover damage like this - it covers rust perforation only. In other words, to be covered by the rust warranty, it must be a rust hole that started from the inside out. Repairs (these could remove the plating), rust caused by damage, surface rust bubbles, or rust from scratches or rock chips are not covered. In other words, the rust bubbling cannot have surface scratches or else they will say that it's caused by damage and not a factory defect and does not qualify for the rust warranty. Don't pick off any loose paint! Rust caused by design issues like this one are normally (should be) covered by the manufacturer. Another example was rust/paint/body damage caused by ice building up at the door drain on some mk5 rabbit (Golf)
If the fender is rusted any more than surface rust and paint flaking, the fender should be replaced for the best repair. I estimate that the cost for a bodyshop repair is over $1000 if it has eaten the metal away. Don't buy generic brand replacement fenders because they never seem to fit correctly. A better choice would be to buy used genuine VW fenders from an auto recycler and have those painted. A color matched fender is also a good idea - you can just bolt it on yourself. A tutorial on how to do quality body work is way beyond the scope of this article. In other words, if it needs anything more than a little touch up paint, leave the painting and body work to a professional.
Procedure to check for rust and repair
To prevent any problems you should trim the bottom tip of the foam soundproofing off so that water and salts/sands won't soak into the foam and rub against the metal fender. The foam is shown below without the fender for illustration (you don't have to remove the fender to repair). Remove the T25 torx screws or other fasteners holding the wheel well plastic liner, pull it away from the fender, and trim the tip off. Also refer to the VW fender rust TSB below.
Here are some views from underneath with the fender attached. The left is a mk4 Jetta and the right is a mk5 Jetta. The bottom edge rubs against the fender. Take note of the side marker light position on the mk4 because I reinstalled it too far to the side and it pushed out the side marker light.
If the fender is removed and repainted or replaced, check for proper panel fitment, gaps, and quality of paint. Open and close the door to make sure it's not touching and the gap between the fender-door and fender-hood are even.
While you're in there, also flush out all the sand collected at the rear of the wheel well. It's drainage from the edge of the windshield/A-pillar and the windshield molding area. Moisture and salt collected there can also cause rust which would not be covered by the rust warranty. Do not apply undercoating or plug that area since you want water to drain properly. If you apply soundproofing, apply it to the backside, the unseen part of the plastic fender liner and not the metal in this area. This will help ensure proper drainage.
Thumbnail gallery of the TSB from VW, click for larger detail.