There is a spray you can buy the you make a little incision and spray under the separating cloth and it's like a glue...you then just pat the material in place. Don't recall what it's called, but you might do a web search and/or go to your local auto parts store and inquire. I hear it works quite well. In regards to your radio, do a search on eBay. People are selling stock Volvo CD/Radio/Tape players all the time for little money. I'd go back to stock if I were you. Just make sure you get the codes for the unit before you commit to buying. I believe the SC816 was the best stock, but there were others too, with numbers starting at SC811 (the one in my old '94 850) through SC816.
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Current owner of a '04 V70 2.5T. Previous owner of a '94 850 Turbo Wagon