Although it was only introduced at the start of 2013, the Polo has taken a podium in every World Rally Championship round it has started.
In the hands of Sebastien Ogier, the car has won the last three rallies and power stages.
But VW did suffer mechanical problems in Portugal and Demaison would not rule out further technical issues.
"Don't forget, this is our learning year," he said.
"People are expecting complete reliability, but this is only the fifth event ever for this car and to expect zero problems is not possible. Miracles like this do not exist in our sport.
"I don't think we will have the same problems as Portugal again, but this is not to say we don't have some new problems with the car. For example, we don't know how will the car work through the watersplash."
Demaison added, however, that the team did not expect a repeat of the Portuguese problems, which centred on driveshaft failure for Jari-Matti Latvala and a minor problem on a rear differential clutch in Ogier's car.
"For Ogier's problem we are confident we have the solution for Argentina," said Demaison.
"It wasn't the actual clutch which failed in the rear differential, just the actuation - which meant the clutch stayed open. It was a small, stupid valve which failed. We have made a new solution to avoid this coming back.
"For Jari-Matti's car, this was a driveshaft problem, so all three cars will have more protection in this area and, for sure, we will take more interest in how the driveshafts are looking and we will change more regularly on this event."
- Sebastien Ogier