Air compressor wiring question (w/ pics)

I have a '78 Sears Air compressor that is currently wired for 220V. I am preparing to run a dedicated line to my garage for it, and am wondering if I should run it 3 or 4 wire (using neutral). If you look at the pics, it appears that the neutral wire was just grounded to the chassis, which doesn't seem right. I bought this used from an individual who inherited it with his house. It was hard wired to his breaker in a 3 wire setup, and the neutral wire was left dangling.

So my question is, what should I do with the neutral wire? My gut instinct is to simply unhook it from motor and not use it.

 

For a compressor, a three wire set up will work fine. Wire it as it is in the pix with the exception of the white wire, which would be redundant.. 240 volts does not need a neutral. One hot on one side of the switch, and the other on the other side. Your loads will come off in the same pairing to the motor.