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It's called cavity wax, and yes, it's used in the build process, and yes, it sometimes smells like crayons. It's a rust preventive, and works quite well.
 

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It's called Cosmoline.
FYI: It is not Cosmoline. Cosmoline is a registered trademark of Houghton International and is a rust preventive used to coat bare steel prior to shipping over salt water. It is far far far too expensive to spray all over the inside of a Jetta, and not required when using galvanized metal. It also is extremely difficult to remove, which would be a problem in auto assembly.

Cavity wax is a low-grade paraffin wax with about 1% of a sodium petroleum sulfonate in it. It costs about 1/5 as much as Cosmo, and it's way the hell easier to work with.
 

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Do all MK4 Golfs/Jetta (Bora)/ and other VW models from that time period smell like

CRAYONS???


Or am I making things up, and just make a fool out of myself :p
Yes!!! Mine does smell like this every once and awhile. I thought it was weird too. Doesn't seem to be any pattern though, just will randomly smell like a crayola factory
 

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all of the wonderful crayon smell-generating **** melted and ran down the rockers and out of my MKIV years ago. :(
 
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