Is it possible to install shift lever seals while the transmission is still in the car? I degreased the four speed manual transmission and clean, red tranny fluid seems to be leaking from behind the shift lever. Do I remove the cover plate?

i do not have an answer for your initial question. However, i dont think automatic transmission fluid is best for your gearbox.

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1985 300TD Turbo Euro-wagon
1979 280CE 225,200 miles
1985 300D Turbo 264,000 miles
1976 240D 190,000 miles
1979 300TD 220,000

GONE but not forgotten
1976 300D 195,300 miles
1983 300D Turbo 175,000 miles

http://i42.photobucket.com/albums/e3...e485-1-2-1.jpg

What type manual transmission fluid is best?

i believe some people use a regular motor oil(10W-40) in the old manual transmissions to compensate for wear.

EDIT: Redline makes a pretty good manual transmission oil it seems from reading other peoples posts on the forums.

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1985 300TD Turbo Euro-wagon
1979 280CE 225,200 miles
1985 300D Turbo 264,000 miles
1976 240D 190,000 miles
1979 300TD 220,000

GONE but not forgotten
1976 300D 195,300 miles
1983 300D Turbo 175,000 miles

http://i42.photobucket.com/albums/e3...e485-1-2-1.jpg

Red Automatic Transmission Fluid was placed in all 1968 220D manual trannys from the factory. It also says that is the correct fluid in the owners manual. However I would agree that there have been some changes in the chemical makeup of red ATF in the intervening years. The great aspect of using this fluid in the manuals is you don't need to shove the shifter with your feet in the dead of winter !!

By the way the 220D in the sig gave great service for the 20 years that it was daily driven, using red ATF.

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1961 190Db retired
1968 220D/8 325,000
1983 300D 164,150