Many versions of both the Dodge and Chrysler Neon have had head gasket problems and failures. According to AA1Car.com, many Neons experience head gasket failure fairly early in their lifetimes, between 40,000 and 60,000 miles. If your Neon is leaking oil, check to see if it is coming from around the head gasket by looking at the engine block around where the heads mount to the block. If there is oil or staining, the head gaskets may be failing or have failed. If this is the case, it is very important to have the gaskets replaced to prevent engine damage.
In other cases, oil may leak from around the cam position sensor. The cam position sensor is under the intake pipes that lead from the air cleaner to the throttle body. Fixing a leak in the cam position sensor is as simple as replacing the rubber O ring.
In some cases, a cam position sensor oil leak can be mistaken for a head gasket oil leak. Fortunately, replacing the O ring on a cam position sensor is an easy and inexpensive repair, unlike replacing a head gasket.
Another common place for oil to leak is the oil pan or oil filter. These oil leaks are typically caused by an improperly installed oil filter or an oil pan drain plug that isn't properly replaced after an oil change. If you find oil leaking from one of these two positions, make sure that the oil filter is properly tightened.
If the leak is coming from the oil pan's drain plug, try tightening the plug. If either is misthreaded, remove them and re-thread them. If you remove the oil pan drain plug for re-threading, however, you will likely have to perform a full oil change.
