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With the temp gauge at 105 or higher, I guarantee that it either needs a radiator and/or a fan clutch, both of which are notorious problems on the 1986/87 six-cylinder diesels. It could be the t-stat or low coolant level but we're assuming that "basic" maintenance has been done on such a nice car. It should never cross ~100C even in blistering temps.
Mine, with new rad/clutch/etc, rarely if ever go above 95C except under serious load (climbing a steep grade, hot ambient temps, AC on max.) Before my new rad/clutch/etc it would be 105-115 on a regular basis. Everyone, including the dealer, claimed this was "normal" a long as it never touched 120C. What a load of crap... now I know better!
Regards,
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