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Scott,
Thanks for your compliment. I have two '96 850 GLT wagons, both 5 speeds. One red, that was purchased new, and one silver, that was purchased when it was 3 years old with 50K on the clock. It was a Volvo VIP car I purchased from a dealer in MA. Ironically, it had originally been sold new by a dealer in CT where I live. The original owner traded it in for an Audi. The Audi dealer wholesaled it, and local Volvo dealer up in MA picked it up and auction, cleaned it up and re-sold it to me. The car now resides once again in CT. It now has a 152K on the clock.
With regard to service issues as you approach and exceed 200K, I would have say there is nothing extraordinary, other than other things mentioned on this web site: A/C evap, RMS, ABS pump. I had all those things replaced before I hit 200K. The RMS went at 165K. Because it caused oil to leak onto the clutch, it just made sense to replace it at the same time. I've had the rear door panel fixed a couple of times with the new metal clips, but it will still rattle sometimes. In fact, I'm now replacing the rear lock mechanism because it causes a "rattling noise". That rattle may have been caused due to a period of time it was hard to close the hatch tightly, and my wife compensated by really slammng it. That lasted for several months, before it was adjusted, and that may have permanantly jarred the lock mechanism.
Something, I've noticed, is the 850 did not come with a chamber adjustment. As you start to put on the miles, your local alignment shop may find it harder to bring your car into spec because of the absence of a camber adjustment. Fortunately, Volvo sells a chamber kit. I couldn't get it from my local Volvo dealer, but was able to obtain one from iPd. Go figure right? I even read the Volvo part number off the box over the phone to my local dealer, and he still could find a part listing.
A noise that appears to be common to manual 850s, is when you let out the clutch, especially when the car is cold, you will hear a rubber like "rubbing noise". According to my mechanic, this noise is caused by a 50 cent bushing, which would cost you several thousand of dollars to fix, because you would have to pull the transmission. It best to wait until you have to replace the clutch or the RMS and then replace that bushing. I had that done on my wife's red 850 at 165K when I had the RMS and the clutch replaced at the same time.
I have noticed, I believe some "smoke" in the exhaust. I'm really not sure, if it is present. The car doesn't use more oil than what I've seen on this site as being considered "normal" for an 850. My independant mechanic said, if smoke does develope in the exhaust, it will probably be a sign of worn rings or valve stem guides that have to be replaced.
I noticed that at around 145K, my silver 850 started to develope squeeks in the front driver's seat that were difficult to isolate and fix. It caused me to replace the tracks the seat travels back and forth on (the two of them together in parts alone cost nearly or over $300).
I guess the best advice, is just to start all over with the Volvo maintenance scheduled contained in your owner's manual and the seperate maintenance schedule that came with the owner's manual everytime you hit another 100K. I hope I was helpful.
Hugh
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