99 Passat temperature guage

Replace the sensor which is located just behind the cylinder head. Early ones are blue, later ones are black, which get replaced with green ones.

I always wonder about grounding problems with these sorts of things. Isn't it often the case that senders are grounded through the attachment point, in this case where the sender threads into the cylinder head or flange? Over the years, this joint can corrode, causing an intermittent ground. Or maybe a previous owner used some sort of hucky puck on the threads to banish a persistent leak, and then discovered that the gauge worked intermittently or not at all (been there, done that). I'd remove the old sender, clean up the threads a bit, and see if that does the trick. Of course, I'd also check the wiring between the gauge and sender. Just a thought from someone with zero experience with a 99 Passat.

VW has gotten away of direct grounding may years ago. They(sensors) are no grounded through the wiring connection. Besides the ECT sensor is located in a plastic coolant flange.

Well there you go. That's what I get for talking out of my arse about a car I haven't had any experience with. The question reminded me of a time long ago when I added an oil pressure gauge to my car and couldn't get the threads of the sender to stop leaking. So I added a few good wraps of Teflon tape to the threads, after which the gauge no longer worked. I convinced myself that I had inadvertently allowed a tiny speck of Teflon to plug the sender's orifice, and decided it was trashed. The possibility that it was simply a grounding problem didn't occur to me until years later.