Mine was the same, now it looks like new after refinishing the leather surface, then re-dying with black Leatherique
Order a 16oz bottle of their "prepping agent" and "leatherique standard color" (black) dye. (the dye is kind of pricey at $40 for 16oz, but it's the best dye $$ can buy -- you won't need anywhere close to all that dye so maybe you can speak to the owner about buying an 8 oz bottle -- he's a very nice man) The prep agent is a pink solution, that smells like alcohol. Rub down the steering wheel very well with it, just enough to break down the exisitng dye. Make sure you don't rub it in so hard that it turns to suede. Just enough so that the dye has something to grip on to.
Then take a small foam rubber paint applicator (Walmart 25c) and apply a thin first coat of dye. Let it dry, then apply another. It's dry to the touch in approx 20 minutes but you should't apply hard pressure to it until at least after 24 hours. 2 coats should do it.
The results are amazing. I did mine about 9 months ago and it's holding up rock solid.