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Chuck:
TheLostArtOf is correct, this is generally a normal function of the volvo turbo unit, especially the oil cooled model in the earlier models (although they all glow). The joing between the exhaust manifold and the turbo as well as some parts of either element will glow red like Satan himself is your copilot.
If you visit the turbobricks site and do a search you will come across a string where this very subject is discussed.
On the flip side, it is possible to have a faulty knock sensor or some other problem that would cause the car to retard the timing and lead to a lean fuel condition, but I doubt that's your problem. If you think it might be take a hammer and lightly (I do mean lightly) tap the knock sensor bolt (not the sensor itself). If it retards the timing you are running fine, if nothing happens you "may" have a faulty knock sensor. I say may because this isn't really a solid test... you need to get a voltmeter and do a thorough check to know for sure. That's probably why I haven't replaced my knock sensor even though I have a "cherry red turbo"... ;)
Anyway, I don't think you should worry about it.
-Rick
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