I planning to remove the rubber air dam from underneath the engine.
Anyone knows if this thing is needed? will I get better cooling without it?

 

The air deflector is there to help create an air pressure difference for the radiator, so that enough air passes through it. How well it works and how necessary it really is, I dont know. But from pictures of lots of other cherokees on here, it does not seem to be terribly necessary.

 

I don't have one...rotted away. It also keeps water, mud, and crud from the accessory drive belt, fans, etc. I don't think it could have any material effect on cooling.

 

Nothing really that a stock or other skid wont do to help keep crap out.

 

It seems to me that without it in crawling speeds the engine will get more cooling from underneath.
what's your thoughts on this?

 

If you feel that you need that tiny bit of ambiant air cooling then you probably have other issues with the coolant system.

 

mine rotted and was laying on the sterring components, i just ripped it all out. no temp difference in traffic or highway speeds.

 

I not only have a front air dam. But also have a piece of felt like material, covering the under side between bumper and radiator. (part of the winter ins. pkg.) And I never had problems. Oddly enough, my XJ was originally purchased in Florida when new.