This can be a slipping belt, a worn out water pump, a damage fan or the worst of all a burnt cylinder head gasket. Turbos running at high pressures tend to blow the cylinder head gaskets. Also check the radiator.
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Two things could be the problem. Seals within the turbo can wear and when pressure within the turbo lowers, as when you exit the freeway, the oil pressure pushes oil into the turbo either burning it in the combustion chambers or burning it in the hot exhaust stream. Also the valve seals can be worn and the same thing as the turbo seals happens
First try a new fuel filter and check your air filter. Sometimes the ignition relay on those is intermittent too. You may want to check the timing also. It is ok to ****** the timing a couple of degrees and see if it runs better. The turbos on those cars can have issues too. take care and good luck.
Fuel pump heats up and malfunctions??? HaHa that's a good one. Tell the dope that told you that, I said the fuel pump is only going to get as hot as the fuel it is sitting in....or at least, lets hope so, unless you like to see bombs go off!
The best advice I can give you is this:
1. Check to see if there are any fault codes in your computer. (On an '86 Subaru, the computer might not be very smart, but check it anyway.)
2. If there are no codes, run the engine untill it stalls, then pull one of the spark plugs and see if there is any spark when you try to start it.
3. If it has spark, then you should check to see if it is getting fuel.
You have to find out which system is failing (Spark or Fuel) before you can even guess what is causing the problem.
I have a 1984 Gl Wagon 4WD; the fuel pump is located on the passenger side, on the frame rail under the back door, just in front of the rear wheel. It and the fuel filter are accessed by dropping the mounting plate that also serves as a protective plate. Again, this is the 4WD non-turbo EA81 engine GL Wagon; could be different on the 2WD version.
I have the same problem with my 86 GL 4WD. One day it started to turn, and then lost all power. I couldn't even turn on the lights. I have played with the ignition switch wires, and gotten it to fire. I think there may be a short somewhere in the switch or the wires to the harness, but I have not isolated it yet. You might check your ignition switch and wiring...