I have a 1986 420 SEL I am evaluating. All windows work, stereo, seats, head rests, starts and drives well. Here is what I'm looking at as issues that will need to be dealt with:

1. valve cover gaskets leaking oil onto headers producing quite a bit of smoke

2. transmission leaking but working

3. rear end bounces up and down, and continues to do so once I step away

I searched the forum for "420 sel" just to be sure I caught up on everything and I'm also aware of the upper timing guide issue. That is also on the top of my list.

But one thing I found in my search that I could not quite pin down is the SLS or Self Leveling System (I think that is what it was called). I do not see a reservoir behind the driver side headlight so i'm guessing I just have blown shocks. however while checking the undercarriage I found something that looks like an air compressor. Any ideas what it is?

Thanks.

Here is a picture: