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Just my 2 cents since I am new to the Brick thing. I recently purchased a 1987 740GLE with 258K on the odo so I am forced to learn quickly.
When I got mine, I had intermittent starting problems. When it did start, it ran like hell. It turned out to be the "radio suppression" relay. Since replacing that relay, it starts right up and idles normally and drives fairly well.
Also make sure the connections for the O2 sensor are OK. They are located on the fire wall on the passenger side. There are 2 connections and if they are corroded, the computer will get an invalid reading sending the car into limp mode.
Just a thought.
-Chris
1987 Volvo 740 GLE Wagon 258,000 mi and climbing
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