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Remove the headlight unit and inspect the internal wiring to see if the insulation on the wires is breaking up - a well known fault.

There's a trick to getting the light units out:

Do, please, take time to read the "Buying a used Touareg" thread ASAP if you haven't seen it - the link is in my signature. You will learn a lot about what to expect.

The one key item on an early V8 is the timing belt.

Unless you know with 1,000% certainty the belt, tensioners, water pump and thermostat have been changed within the last 80,000 miles or 5 years, your engine is on borrowed time.
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