I have a 1993 240 with 180K. Last month the temperature gauge started doing very strange things, like floating up near the red zone eratically. First I checked fluid level, then changed the thermostat, but neither helped. A week later, I was sitting in my driveway and noticed when I turned off the headlights, the temperature went to normal. The instant I turned on the lights, the needle started creeping up to the red zone.

The solution was a temperature compensator board. The local Volvo dealer sells it for around $120, but I was able to find a new one online for $50. It was a thirty minute installation and now the temp gauge works perfectly. Email me if you need to know more about the installation.