i had it in that same position as in the photo you posted.

now, as a solution so i can put the part back in the car while waiting for a new part, i pulled the steering wheel lock assembly with tumbler installed then with key in position "2" and the wheel lock retracted i filled the end of the mechanism with epoxy and have it curing right now. this way, i can install the part back into the car and button everything back up.

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1982 300sd from craigslist $800 greased on one tank with NO CONVERSION in the Hot Texas Sun. (currently dead & awaiting engine damage investigation and/or longblock swap)
new daily: '03 vw 5speed jetta tdi wagon. bagged&chipped

Here's what I found on mine and how I repaired it.

Steering lock repair

Its been working for about three months now no further problems.

However, Epoxy works just fine basically keeps the lock back and that troublesome pin disengaged.
The only thing you lose with the epoxy is the ability to lock your steering.

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Experience : what you receive 3 seconds after you really needed it !!



86 300SDL 387,000? Motor committed suicide
81 300SD 214,000 "new" 132,000 motor
83 300SD 212,000 parts car
83 300SD 147,000

91 F700 5.9 cummins 5spd eaton 298,000
66 AMC rambler American 2dr auto 108,000
95 Chevy 3/4 ton auto 160,000
03 Toyota 4runner 180,000 wifes