First step is to check all vacuum hoses connected to the transducer.
On my 78, surging was caused by the transducer. Surging was accompanied by the speedometer needle bouncing a bit. Removed the transducer, inserted the tang of a small round file in the socket where the speedo cable from the transmission connects, and spun it. Could hear and feel something rubbing inside. Disassembly is simple. Just be careful when removing the nut holding the coiled copper spring to the case, and while pulling off the sensor plate.
On mine it turned out the rotating disk, driven by the speedo cable from the transmission, was rubbing slightly against the sensor plate just forward of the rotating disk. Using a small hammer, I carefully tapped the rotating disk rearward on its shaft a bit, then reassembled the transducer and checked it by spinning it again. Repeated the tapping-reassembly-spinning process until no more rubbing was heard or felt. Then I cleaned up the transducer interior and parts, sparingly lubricated all friction points, reassembled, and reinstalled. The system works fine now. Rock steady holding speed and no more bouncing speedo needle.
Sorry that I did not take photos, but the transducer is pretty simple.
Hope this helps.
Good luck!
Jerry
