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If it's loosing colant, you could have a bad head gasket, but that's not the only place it can go. if you were loosing coolant through the head gasket and not enough going into the oil to make a milkshake, you should be getting a hefty amount of white smoke out the exhaust . Have you checked the transmissin fluid to make surethe coolant isn't going there through a leaking tranny cooler in the radiator?
Made sure to check the floorboards for leaking coolant from heater core?
If it winds up being the head gasket, if your mechanic is not intimately familiar with that engine, do yourself a favour and buy the green manual for that engine from www.volvotechinfo.com and let him borrow the thing ( anytime you own an oddball engine it's good to carry the proper manual with you at all times, even if you don't work on it, it will save you extra labour time on shop repairs on the road if you aren't having to pay for hit and miss time ), and do have the timing belts and tensioner/idlers replaced while he's in there.
Those engines are very particular about being assembled properly
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-------Robert, '93 940t, '90 240 wagon, '84 240 diesel (she's sick) , '80 245 diesel, '86 740 GLE turbo diesel, '92 Ford F350 diesel dually
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