Like I said, this has happened before in other threads. The lucas goop sinks right to the bottom of the pan and can;t get sucked into the filter. I'm guessing that this is because it was poured in with the engine off so instead of mixing it all just sat at the bottom.

ATF is cheap, and if I'm right it will save you a lot of time and money. Change the fluid and filter, add some trans-x and see what happens. If your tranny starts working again we can trouble shoot your flaring issue next.

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2004 F150 4.6L -My Daily
2007 Volvo XC70 -Wife's Daily
1998 Ford F150 -Rear ended
1989 J-spec 420SEL -passed onto its new keeper
1982 BMW 733i -fixed and traded for the 420SEL
2003 Volvo V70 5 Speed -scrapped
1997 E290 Turbo Diesel Wagon -traded for above
1992 BMW 525i -traded in
1990 Silver 300TE -hated the M103
1985 Grey 380SE Diesel Conversion, 2.47 rear end, ABS -Sold, really should have kept this one
1979 Silver 300D "The Silver Slug" -Sold