WHILE DRIVING HOME AT NIGHT, MY SON AND I SMELLED SMOKE. WE EXITED THE VEHICLE, CHECKED UNDER THE HOOD, BUT FOUND NOTHING. WE CONTINUED HOME AND PARKED IN THE GARAGE. STILL SMELLING SMOKE, WE RE-INSPECTED THE VEHICLE, BUT WERE UNABLE TO DETERMINE AN ORIGIN OR ANY VISIBLE EVIDENCE. BOTH SEAT HEATERS WERE ON DURING THE DRIVE HOME, BUT THE SEATS SHOWED NO VISUAL SIGNS OF DAMAGE AFTER PARKING. NEXT MORNING WE OPENED THE VEHICLE TO DISCOVER THE CABIN WAS FILLED WITH SMOKE WITH AN APPROXIMATE 1?HOLE BURNED UP THRU THE PASSENGER SEAT ON THE LOWER RIGHT BOLSTER. APPARENTLY THE SEAT HEATER INITIATED A THERMAL EVENT WHICH ERUPTED IN A SEAT FIRE AFTER WE TURNED OFF THE IGNITION AND PARKED THE CAR IN THE GARAGE. FORTUNATELY, THE FIRE DID NOT ENGULF THE VEHICLE OR IT COULD HAVE CAUGHT OUR HOME ON FIRE, RESULTING IN POSSIBLE INJURY OR DEATH TO MY FAMILY. I BELIEVE WE DODGED A BULLET BECAUSE THE SEAT FIRE DID NOT SUSTAIN ITSELF AND ENGULF THE VEHICLE. VW HAS AGREED TO REPAIR THE BURNED SEAT AT THEIR EXPENSE AND MAKE A MITIGATION REPAIR. HOWEVER, VW HAS DECLINED MY REQUEST TO COVER ANY SIMILAR MITIGATION REPAIR TO THE OTHER SEAT. IN OCTOBER 2004, THE NHTSA ODI CONCLUDED THAT ?DRIVER-SIDE SEAT HEATER MAY FAIL OR MALFUNCTION DUE TO NORMAL VEHICLE USE? BUT ?SUCH FAILURES DO NOT POSE A SIGNIFICANT RISK OF INJURY OR FIRE.? THE ODI STATED THE INVESTIGATION DID NOT CONCLUDE THAT A SAFETY-RELATED DEFECT DOES NOT EXIST AND THE AGENCY WILL TAKE FURTHER ACTION IF WARRANTED BY THE CIRCUMST