2000 V70 SE; 292K miles; AW55-50SN; Denso
Recently experienced same issue with our 2000 V70 (above).
Here's a BB AWD thread that summarizes my DIY experience:
https://www.brickboard.com/AWD/volvo/1687772/V70-XC70/steering_lock_removal_repair.html
Was able to get the car on the road again with ignition key operating freely in all positions, while avoiding a tow. Although the steering wheel lock, alarm and keyless entry no longer work.
An entire new ignition lock assembly may be available for your S60 from Volvo, using your VIN and/or key code.
In doing the research for the above repair, I found that this is a very common problem for higher mileage Volvos. In speaking with the local Volvo dealer, many Volvos get towed in for ignition lock replacement after the car is immobilized from stuck key and locked steering.
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