Have had many 240's, this is the first time with a tranny problem. Seems to be stuck in first gear. Shop serviced it and has same problem. Was told maybe valve body assy. When this problem first appeared it was sporadic in nature and would not occur for me, but did for the female driver. Finally I caught it happening, checked fluid and it was low. Added quart and then shifted fine.
It went to another shop and was told no fluid on stick, found this hard to believe since I drove it on to the drop down tow truck. They put more fluid in and now there's way to much. Both shops want over $1500.00 for overhaul. Didn't spend that much for the whole car and don't think I need an overhaul, well maybe I do but not the car. Now someone tells me that the torque converter could be bad because of the fluids level issue.
I am ready to either replace both parts but not the transmission with one from the junk yard, due to not knowing if it would work any better than the current one.
Kick down cable is fine, disconnected it to see if it made any difference---did not. It won't shift up. If I remember correctly a broken cable would start in second gear from standing still.
Any ideas would be helpful.
Craig

 

I know this was long ago for you, but i am having the same problem now. If you wouldn't mind, I would be interested in hearing what came of your situation. Thanks

 

What did I end up doing??
Good ?
Well, started with removing valve body to try and rebuild it. Lots of little pieces. My mechanic friend didn't do so well with it. Found use trans in salvage yard, replaced and it didn't work. Replace it again with a new kick down cable, worked. So 1 for 2. Cost about 200 for trany and the cable maybe around 40. Doing the work wasn't to difficult. The yard pulled the used one. We did this on the ground. You gotta do what you gotta do. Car runs good and I hope not to have to do this again for this car.
Rebuild would have cost 1500.00. Call around, you can still find these things. Just make sure you get the right one. With or without the notch on the bellhousing. I got the wrong one and had to swap them out.

 

Ouch...89 and newer needs the notch for the crank sensor but since 1984 at least, the area with the notch can be removed in less than 5 minutes. The metal on the bell housing is extremely thin at the proper place...in fact, on the inside of the bell housing the "knock out area" is quite visible. But, you done good. JY trannys, especially the standard AW70, are quite cheap. Very few people are competent to rebuild them correctly...best to get a new one. The last two times I've needed a transmission, I've bought heavily damaged cars off of Craigs List for $100-250, you know the ones. Looks like they were in a demo derby but still run and drive? Pull the transmission and part the rest out on eBay, Craigs List and Turbobricks. Not only do I get a free transmission, I make enough to pay for my time! I hate scrapping Bricks, but I look at it as them being organ donors...