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In 2005, it was announced that 1998-2003 B205 and B235 engines suffered from oil sludge-related failures. The failures are a result of a revised piston ring setup that was intended to reduce friction cause excessive blow-by into the crankcase as well as a new positive crankcase ventilation (PCV) system used on these models that was not capable of handling this excessive blow-by. Due to the poor crankcase ventilation, combustion by-products contaminate the oil, causing its additives to break down prematurely. Especially in the case of short trips, the engine oil does not reach full operating temperature for a sustained amount of time. When this occurs, these contaminates (mostly water, various unburned hydrocarbons, and acids formed by nitrogen oxides and sulfur oxides and water) aren't readily able to evaporate, making the situation even worse. Where the blow-by gases settle directly on the metal surfaces of the engine, a build up of "varnish" results.
The inadequate crankcase ventilation allows the PCV system components themselves to fall victim, as the poor ventilation of the blow-by gases allows them to condense into an acidic soup that attacks and dissolves the PCV hose rubber. This further compromises the effectiveness of the system and introduces fragments of hose rubber into the crankcase. Once the inadequately-vented combustion products have depleted the motor oil additives, the oil will start to oxidize rapidly and form a soft sludge material. The oxidized oil is also much more susceptible to thermal breakdown when circulating through the turbocharger. This breakdown leads to the formation of hard carbon particles, in a process known as turbo coking.
As a result, the aforementioned oxidation byproducts (soft sludge, harder carbon deposits, and hose rubber fragments) will then start to agglomerate. If not caught in time, the agglomerate can clog the extremely fine wire mesh at the end of the oil pump pickup tube, resulting in a loss of oil pressure. This resulted in several cases of rod bearing failure, premature turbocharger failure, as well as other lubrication-related failures. The sludge problems can be repaired under a special extended warranty for 8 years and unlimited miles. However, in order to take advantage of this warranty, SAAB requires their oil change intervals to be met and receipts presented to verify this.
