It appears to. More aggressive on engine braking and higher shift points on my '16 TDI. I've read in here it has multiple 'maps' for towing. It also makes other changes, such as turning off Side Assist (if equipped) and disabling the hands-free tailgate.
I suggest plugging it in before towing though- safety and all that.

 

Great information. I’m looking at different Treg now and the seller doesn’t see a connector but it has a hitch. If it has a factory hitch does that mean its wired for a 7 pin connector ?

 

See the other post. Trailer Prep and Trailer hitch are different, but probably if the hitch is factory the prep is as well.

 

If you get the factory tow hitch it will come with a wired pin connector underneath the hitch but you still have to buy a 7 pin adapter to interface the VW connector.
Yes, when the connector is plugged in, it will pull in various other Towing maps which can slow down a trailer by braking first when arriving at a corner while going too fast. The treg will measure yaw, pitch and roll, steering angle, wheel speed, ambient temp, throttle position, which gear its in. It will hold a higher RPM before shifting gears and hold it in gear slightly longer when decelerating for engine braking. System will also switch of rear proximity sensors, side sensors, disable the auto open/close rear hatch and give you a nice pictogram on screen. But if your are towing something that has brakes then a suitable brake controller module still has to be fitted to the connector under the dash on the drivers side.

 

'nuff said.