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When the transmission detects a fault it flashes the up arrow and locks
the transmission in third gear (limp home mode). Starting in
third reduces acceleration so the car will feel slow.
A common cause is a failed PNP switch. You can search on "pnp" (below,
to the right) to find many posts on this. But, the PNP switch is not
always the cause of the problem.
More details on PNP are at:
http://volvospeed.com/Repair/pnpswitch.htm
You can still drive the car as the PNP switch failure is rather "slow".
I drove ours for about 4 months. Once the car is warmed up, turn off
the ignition and restart the car. This often resets it for a while and
gets the car out of limp home mode.
Most Volvo mechanics have replaced a PNP switch (my independent
did 20 last year) so you should be able to find someone to give
you a pretty good qote on replacement. Parts are $80 to $120
(depending on the markup) and about 3 hours labor.
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