I have a 1980 DiaMarco 21 daycruiser, 7.4L, Borg Warner Velvet Drive with a Mercruiser outdrive. Boat is all original and runs flawless until now. It has developed an oil leak at velvet drive at the transom of the boat. When I lift the engine cover and look at the transom from inside the boat, the oil leak (red fluid) mixed with water leaks right down the back of the tansom right into the bottom of the boat into the bilge pick up. Probably a seal.
Anyone had this issue or know what the problem may be?