Ya mine got worse and worse eventually your car wont start sometimes and it will say wait 3 minutes and try to start, then wont start at all you will finally have to bypassed the chip in the key. you need to use a multimeter set to ohms touch each probe to each side of the chip on your key you should get a reading like .300 to .800 or something. then go to radio shack and buy a resistor as close to matching as you can. cut two tiny wires under the steering column and wire the resister in to the ends of the wire going away from your key(back to the computer). I can post a pic of mine when I get home. basically the part of the ignition that is supposed to read the key is all corroded up and not reading it. I read somewhere to spray wd40 in the ignition to clean it that seamed to work a couple time but I may just have been a coincidence. but this is a permanent fix.
Lac the codes will show up as wrong key after correct(IPC codes) or some BS but yes a VATS bypass is probably in your future or a new ignition switch if you like tearing the column apart. Tiny wires wear out or the pellet in your key starts getting flaky usual causes.
clip the orange wire there will be Two separate white wires inside. I soldered the resister in and used shrink wrap to keep it from touching stuff. its best if you cut one wire shorter than the other so the resister leads will bend in a good spot to fold it in half.
I used rubbing alcohol with a q-tip, eraser , and about everything I could read online to clean inside and out. it all makes you think you did something till your in a hurry and you gotta wait 3 minutes. after a few times of waiting 3,6,9,and even 12 min. you'll be ready to get snipped.
I guess its worth shot but sounds like more work. if you plan on keeping the car for a while I personally would go ahead and bypass it and be done. everything still works the car doesn't even know the difference. its just like making the chip a permanent part of the car instead of using the one in the key.
LAC the odds are those wires are failing. No sense doimg all that work that could fail quickly. I would either bypass or new ignition switch. The bypass is relatively easy, especially compared to you WP nightmare. This only a one beer job.
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