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this thread. Of which most applies to pre 2000 x230 models.
The following applies to mechanical injection engines.
The chip in the key is an electronic transponder, similar but more complex than a supermarket security tag. There is an aeriel surrounding the ignition key (black ring), a code receiver which is usually hidden in the steering column, and an immobiliser on the injection pump. This immobiliser is protected by a tamper resistant shield.
When the ignition is switched on, the code receiver sends an energising and interrogating radio pulse to the key. The key should reply by sending its coded identity. If this code matches one stored in code receiver, a message is sent to the immobiliser on the pump, to allow the energisation of the fuel cut off, or stop solenoid. (The solenoid must be energised to allow fuel to flow.)
Metal objects on the key ring can absorb the weak radio signals. Other coded keys can cause interference. The weak radio signals can be attenuated by lightly corroded contacts at the code receiver, also it is possible for the short cable from the aeriel to be damaged. There is also the possibility of the radio components going off tune.
When I had code failures on my 2006 x244 last year, I approached the problem from the attenuated radio signal direction. There was some precedent for this approach.
Having gained access to the code receiver I disconnected the three pole aeriel connector, applied contact cleaner and replaced. For good measure, I also treated the other connector the same way.
On testing the system functioned as normal, with no failures to date. Worth a try, but no guarantee of success.
If all else fails you have the advantage that the immobiliser can be removed from the pump, allowing the ignition feed and solenoid wires joined. The vehicle will then start with an unchipped key, but there may be insurance implications.
