If the motor is good, I don't feel that $600 is out of the question. Before parting the car however, I would insure that the tranny is indeed toast. A little while ago, I bought a 300D with a "bad tranny"for $600. Towed it home and found it was nothing more than a seperated CV joint.........I made a boatload of money on that one

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81 Mercedes 300SD 289k.......SOLD
82 Mercedes 300CD 252k......slow ride

82 mercedes 300 SD...mi Unknown
83 Mercedes 300D ????ksniff..gone too
84 Mercedes 300D 148k........SOLD
85 Mercedes 300TD 386k and holding some one elses project