Yup. You have the solenoid for the wrong starter. I'm surprised to see they were using the same design way back in '76 but if it's the same inside as the newer versions, this has a real easy fix. I don't have this starter on my web site yet but I will in a few weeks. If you need instructions on the repair procedure, I'll work on it tonight.
Basically you remove the three bolts on the solenoid cover, (red arrow), then pull out the contact disc with the plunger and spring. You'll see the two copper contacts inside that are burned away. The newer version of this starter is used on Chrysler products since the late '80s and I've replaced a lot of these contacts. We even have a farm supply store that stocks the repair kits for them now. Cost is about 12 bucks. I buy just the contacts from a local rebuilder for three dollars each. I rarely have to replace the contact disc / plunger.
On the newer version there are four different contacts available. All starters on Chryslers and Toyotas use the same "battery" contact. There's three versions of the other contact, and no way to know which one you have until you take it apart and look. The kits come with all four but you only use the two you need.
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Saturday, October 20th, 2012 AT 9:27 PM