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you can easily get silly on an engine - i regularly spend $15k building a track engine
but, you don't have to do everything
if it were me, and i absolutely had to stay with the same block, i'd bore it out, line the block and use normal pistons - going from a 2.5 to a 2.7 would give you about 12hp all by itself, and a bunch of torque
then, i'd bump up the compression to about 11:1
bigger throttle body for sure
then maybe some nice mid-range cams
always always always balance the engine
might need a header
a decent tune at the dyno
this should net you about 200hp - i know i've gotten that much out of one of these on a "streetable" engine
might be a lot cheaper though to grab an S2 3.0 or a 968 engine though, and give you a lot more power right out of the box - i think a guy here is selling one
weight reduction will give you improvements you can feel though - dump the seats for lightweight ones, and replace the rear hatch glass with lexan for the biggest changes
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