While I don't blame any of the car manufacturers for doing this and COMPLETELY understand why they do it, I also view it as a way for them to cop out of manufacturer defects they know the car already has.Source ; http://forums.vwvortex.com/showthread.php?5635710-TD1-warranty-flag
Re-post or not = MUST BE SHARED!
" Be careful out there if you have any VW/Audi under warranty. VW/Audi as now implemented a automatic warranty flagging system called "TD1". ANY car that is brought into service will be automatically scanned and if there is ANY modifications/chip/performance software your info is sent to Audis main server and your car will be flagged 'TD1" meaning modified ECU/suspension/shifter/exhaust.
They can use this as a basis for denying any warranty on powertrain. They also are implementing this with short shifters/suspension/exhaust/etc. This is a way for VW/Audi to say "sorry,the car is not the same car you bought,no warranty now".
I recently bought a 2012 S4,and was planning on doing a SW upgrade,but the automatic TD1 flag has me waiting until warrantyis up OR the tuners have figured out a way around this.
This is for ANY tune/modification,so if you are worried about warranty.....this is a red flag
Before,you could "switch" the software to stock........now it does not matter,they can detect it regardless,and ther is NO company at the time that has "undetectable SW".
This sucks,but I just bought a 60K car,and *if* something fails (like they ALWAYS do with VW/Audis) I don't want to be SOL. A guy with a B7 S4 got denied a transmission repair due to a bad synchro (a common problem) due to his car having a "short shifter"......that is a $7,000.00 transmission!
VAG pays the dealer for warranty work,so it is out of the dealers hands,if VAG denies your warranty,the TD1 stays for the life of the car. Believe it or not,BMW & Nissan are actually even more hardcore about this,and they flat out deny warranty if mods are detected. I guess they all got tired of fixing cars pushed beyond OEM limits.....I knew this would happen eventually,but why now? "