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How do I remove the steering lock on my e21 to replace it with a new one

Have you snapped the key off or anything, as barrel needs to be in a certain position to be able to withdraw it.

got the barrel out but the steering lock has collapsed so need to fit a new one but I cant get the old one out

If you ever need to, here's how to remove the cylinder:

Remove the under column panel. Once off, you'll see a metal tab over the cylinder held in by a round-head bolt (A). Using a dremel, grind flats in the bolt head and use a hammer/screwdriver to loosen the bolt. There are also 4 round-head bolts just above the cylinder (B). These attach the steering column to the upper cover, where the cylinder is housed. The cylinder will not come out until the cover is unbolted and separated from the column. Again, use a dremel to grind flats on the bolt heads and hammer them out. I replaced all these bolts with regular hex bolts.

Now further towards the front of the car is a bracket that holds the column to the dash support via 2 round head bolts (C). You will have to grind and chisel them out and the column will drop enough to separate the upper cover from the column. Unplug the cylinder and it should slide out freely.