My problem is that the key can be removed in more than one position. You can basically take the key out even in run position?!? This doesn't seem like a good idea. Do I need a new cylinder or just a new key to replace the somewhat worn one?
This can be a combination of a worn key and cyl lock. You can try a new key first. This may fix it for a while before you change the lock. I personally like it when this occurs because you can open the trunk without having to turn off the engine. With keys removed, you still cannot turn the switch once it's turned off so it's also safe.
My 64 was doing this too. I figured the lock was trashed, so I pulled it apart and found that somebody had squirted grease in it, making the tumblers a big gooey mess. Cleaned it with some spray solvent, got a new key, and it works like new. Maybe you can get off this easy too!
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