Evil rust. I hate it! All the salt spead here during the winter in Nova Scotia causes lots of rust problems. Even my '91 745 needed a small patch on the driver's floor about 6 months after I bought it (about a year and 1/2 ago). We use a product called 'Fluidfilm' (www.eurekafluidfilm.com) to prevent rust. My Volvo mechanic sprays every part of the car he can possibly get to with this stuff, including the floors. It's great stuff! I'd clean all the rust away around your Volvo's hole, weld a new piece of metal in, coat it with POR15 or something similar and then after that dries, coat the whole floor (and any other part of the car for that matter) with Fluidfilm if you can get your hands on some. My whole Volvo is coated in that stuff and it's great a repelling water and protecting the car's body. I touch it up periodically for maximum protection and I hope that it will protect my Vo for many years to come! I've never tried the POR15, because it seems to be hard to get around here and it's expensive to order, but I hear it's quite good. I look forward to trying it sometime. I hope this info helps!
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Chris. Halifax N.S. '91 745Ti, 273K km.