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Amazingly, my battery ground strap similar problem (archive)
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Posted by Lars PNW 82_733i on June 10, 2001 at 12:34:53:

In Reply to: 85 735i Auto, Fuel Gauge Undereading by 20l posted by rob (downunder) on June 10, 2001 at 04:21:34:

Problems with my fuel guage, temp guage and low lights were all solved when I found my chassis ground from the battery was rather frayed. Even my electric door locks started working again when I put a new strap on. It appears that a weak chassis ground link reduces effectiveness of all chassis mounted components. That's a cheap fix, if it works for you like it did for me. My gas guage was slow to come up before and never registered full.

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