Both four-cylinder and six-cylinder Toyota engines - most commonly used in the Toyota Corolla and Toyota Camry - have been prone to oil gelling or "sludging." This can affect cars that are only a couple of years old. Before buying a used Toyota, it may pay to look under the valve covers for "sludged" oil. We recommend that you change the oil on your Corolla more often than recommended, (at least every 5,000 miles), and use synthetic oil. Blue smoke may be one symptom.
Toyota refused to pay for engine damage for a while, though the company, while blaming owners for the problem, relented. Here is Toyota's new policy. The moral: keep your oil change receipts and use synthetic oil.
Here is the current state of the art:
Toyota Motor Sales, (TMS) U.S.A., Inc., announced in April 2002 a new customer satisfaction program for owners of 1997 through 2002 Toyota and Lexus vehicles equipped with 3.0 liter V6 or 2.2 liter 4-cylinder engines.
Toyota wrote that it "is taking this action because a very small number of customers have reported engine damage from motor oil breakdown, also known as oil gelling or 'sludging,' a result of oil change intervals delayed beyond the factory-recommended schedule. While any make vehicle can suffer from this condition if the oil is not changed often enough, Toyota has initiated this program to ensure owner peace of mind." We note that this is a handy way to blame the owners for what is clearly a design flaw - since it doesn't affect earlier vehicles or other engines, and is in fact quite rare on other automakers' engines. We have also heard that this happens even if you follow Toyota's recommendations on oil changes.
Toyota continues: "To make sure that customers have absolute confidence in their vehicles, this program will cover repair costs and incidental expenses for which a customer has paid or could incur as a result of damage due to oil gelling for a period of eight years from the date of first sale or lease without a mileage limitation. In addition to the costs of repairs, reasonable incidental expenses, such as car rental, and other out-of-pocket expenses will be covered.
"This program replaces a previous special policy adjustment regarding oil gel damage, and extends protection against this condition well beyond the new vehicle powertrain warranty period."
Customers whose engines have needed repair in the past should contact Toyota at 888-802-9436 or Lexus at 888-654-6421 for details on obtaining reimbursement. If it happens to you in the future, see your dealer for repairs.