Does anyone know how to replace the Gear Position Sensor in the 2000 S40? Volvo will replace it for $500.

 

I received a 25% off coupon from VOLVO which can be applied to this service. I guess I'll use it. It appears that no one in the community knows how to replace this item!!

 

I cant tell you step by step but if you want to save 400ish from the stealership just do this....
buy the gear position sensor from your stealer(prob around 150-200 bucks) then go home.... open up your hood and look for the gear position sensor... I remember seeing it on the right side of the engine... its kinda easy to spot... it looks kinda like a brake pad lol ( also looks just like the part you bought which is the gear position sensor lol) but any way when you find the part just take off and replace it... simple as that ... and volvo charges 500 bucks for that lol thats funny

 

It is a pain.
I couldn't post a reply to now I tried but it was so long the site is messed up and would not let me post it.
You have to remove the battery and tray. Then the 2 13mm nuts and 1 10mm nut by the sensor. Then unplug it from the back on the top of the transmission. You will need to fish it out or remove the ties holding it to the rest of the wiring.
Loosen the big nut that locks onto the shaft and slide it off. But you really need a special tool when installing it to make sure it is set properly. If you don't have the tool it might be off and not allow the car to start.