TRAVELING AT POSTED SPEED LIMIT ON LOCAL HIGHWAY WHEN THE ENGINE LOST POWER, BATTERY LIGHT ILLUMINATED, A/C STOPPED BLOWING ALTOGETHER. VEHICLE WAS TRAVELING UP SLIGHT INCLINE SO VEHICLE PULLED INTO NEAREST PARKING LOT OFF OF HIGHWAY. ONCE VEHICLE PULLED INTO PARKING LOT IT WAS TURNED OFF AND THE KEY REMOVED. ATTEMPTED TO RE-START VEHICLE, ENGINE WOULD TURN OVER BUT WOULD NOT START. REMOVED KEY FROM VEHICLE, EXITED VEHICLE AND NOTICED SMOKE COMING FROM UNDERNEATH HOOD. RAISED HOOD AND FOUND TOP LEFT REAR ENGINE COVER AND SURROUNDING PLASTIC TUBING AS WELL AS THE FABRIC ON THE UNDERSIDE OF THE HOOD ON FIRE. FIRE DEPARTMENT WAS CALLED BUT FIRE WAS EXTINGUISHED PRIOR TO THEIR ARRIVAL. VEHICLE TOWED TO LOCAL VW DEALERSHIP AND AWAITING INSURANCE ADJUSTER AND VW TO ASSESS DAMAGES. *TR