What a ridiculous thing to say... of course overfilling will cause smoking!
I have attached a link to further support this info.
Turbo Blows Smoke: Overfill Oil. I have received several messages from Volvo neophytes relating the same or similar stories: I went to the quickie lube, where they proceeded to overfill my Turbo-engine oil by [1-2-3] quarts. Just after I started up and drove out, thick clouds of blue/black smoke came out the tailpipe. Now my mechanic says I need a new turbo. What gives?
I am not exactly sure how to diagnose this, but let me throw out a couple of hypotheses for comment:
1. It would appear that anything restricting the turbo oil drain would cause the unit to overfill and blow oil into the exhaust pipe. If the car were seriously overfilled with oil, this may have an effect on crankcase ventilation, probably starting at the oil breather box drain. So overfilling might clog the breather box, interfere with crankcase ventilation, stop the oil drainage from the turbo, cause the turbo to overfill, and allow this extra oil to be forced out past the turbo seals.
2. Similar hypothesis but the unrelieved blowby increases the oil pumped to the turbo and not drained, causing excess oil in the turbo, increasing crankcase pressure, and forcing this oil out the exhaust. If either of these are correct, then fixing the problem merely means draining the oil, replacing with the correct amount, and cleaning the crankcase breather system. Oil burning should then stop at once. Why would the turbo unit be damaged? If indeed it was damaged at all (another dealer boat payment due?) Thoughts?
[Response: Abe Crombie] The seals used in turbos are a single piston ring type seal and a labytrinth seal system. The labyrinth deal is simply slinger washers in a cavity through which the oil would have to travel against centrifugal force to leak out. If you overfill engine the oil is restricted in draining back to the hole in side of block because the hole is now covered by oil being splashed up into the drain tube. With no easy path to drain the oil out of the piston ring seal area the oil can be passed through both the intake housing seal and the exhaust housing seal. The flame trap/crankcase breather system being plugged has similar results.
[Response: Jim Stephenson] I believe this is the answer. My turbo was overfilled and would blow clouds of smoke. The oil was being burped up through the breather box and would run in to the turbo. Under heavy boost it would drag the turbo impeller down and shortly after that a BIG cloud of white smoke would billow out the back. After I changed the oil no more problems. But what a mess!!!
[Response: Rob Bareiss] This experience shouldn't result in a damaged turbo. Mechanical parts don't usually fail due to TOO MUCH oil... The turbo might not pump oil very efficiently, and it could conceivably do something strange if a lot of oil hit the vanes as it was spinning at a high speed, but they're pretty tough little units. I could see damage to a catalytic converter resulting from this.
[Contrary Opinion: John O] I've rebuilt my original turbo using IPD's kit and there's a direct oil feed line running line pressure directly into the turbo unit, which then feeds the bearings. The only thing that keeps the oil in there are the seals. I've honestly never seen this happen, but I think it's possible that if too much pressure got to those seals, maybe one blew out, like the exhaust side? [Response: Dick] You may have messed up the O2 sensor at this point which will generally cause lots of black smoke, at least in my experience.