Variable compression technology for internal combustion engines will become increasingly more important in the future to meet stringent global fuel economy and CO2 standards. A 2-step VCS system is in development at AVL and the basic functionality and potential were described in a technical paper and presentation at the SAE WCX 2017. The system is based on a hydraulically switched and locked telescopic conrod. VCS system hardware was designed, virtually optimized with CAE simulation methods and procured for the boundary conditions of a typical 2.0L I4 turbocharged direct injected gasoline engine representing state-of-the-art for the next few years to come. This paper will describe the latest status of the development efforts and the results gained during motored and fired engine testing and the completion of the functional validation and proof of concept. Fired single cylinder and full multi cylinder engine tests were performed to validate the general function in the typical operating range of automotive turbocharged direct injected gasoline engines, such as behavior under different mechanical and thermal loads and speeds. Motored single engine testing was performed to investigate the influence of the oil characteristics on the function, such as different oil grades (5W30 versus 0W20), different oil temperatures, aged oil, oil aeriation and oi contamination. The potential of the system for inclusion into new and future engine families will be discussed and the next development steps will be outlined.