Update.
I sent VW a letter of complaint. It effectively asked: why are we getting crappy customer care in Europe, when the same known fault is getting fixed for free in the USA?
Well today I got a phone call. They said that they are going to offer me a 50% contribution towards the cost of parts and labour as a gesture of good will. That is worth £300 to me.
Well, I am quite a bit happier now. But I am not happy. So, I will wait till I get the money and then I will send them a letter of thanks.
My letter of thanks is going to contain a not very subtle threat to get in touch with Watchdog if I don’t get the rest of the money refunded. Watchdog is a BBC consumer rights program that loves to raise issues like this. Mentioning them in a letter was a suggestion of a marketing manager I know. She said being featured on Watchdog can be very damaging to large organisations, and that they take the threat of being featured very seriously.
I might even get in touch with Wathdog in reality. I would probably be even more satisfied to see VW featured on their program than getting the rest of my money back!