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  • Writer's pictureHunter Dias

NP246 Transfer Case Won't Stay in 4Hi


A frequent complaint received from customers who own a NP246 transfer case is that when they shift into 4Hi, the indicator light will flash followed by the unit falling out of 4Hi and go back to 4Auto.

This is NOT an internal malfunction of the transfer case itself but is an external electronic issue.


The NP246 does not have an internal detent system like most earlier model transfer cases. It does not lock into a specific gear position. This “locking” has been replaced with the encoder motor. How the encoder motor works to lock? It will electronically move the shift fork into desired position based on driver selection on the push button pad. A certain voltage input received will tell the encoder motor to move to a set position. Once in position it will verify it has made it. Once verified, it will “lock” into place with a built in mechanism of the encoder motor.


If 4Hi is selected by the driver, the encoder motor will go to 4Hi position. If it cannot verify through its circuitry that it has indeed made it to 4Hi position, or that it cannot securely “lock” the encoder motor into place, it will not stay there. It will default back to a known position, 4Auto, like a safe mode. The 4Hi indicator on the button pack will flash, fall out of 4Hi, and then 4Auto will light.


Because of this, the driver will think something internally is wrong with the Transfer Case. There is nothing wrong with the transfer case, it is solely in the encoder motor, not able to hold position in 4Hi.


Even though this is an electric issue no Power Train Codes, will be set. All codes for the transfer case will be set on either the Chassis code or Body Code.


First DTC character

The first DTC character is always a letter. There are four types of codes:

  • P codes: “P” indicates a problem with the powertrain. It includes the engine, transmission, drivetrain, and fuel system.

  • C codes: “C” indicates a problem with the chassis. It refers to mechanical systems outside the passenger compartment, such as steering, suspension, and braking.

  • B codes: “B” indicates a problem with the body. It covers parts that are found in the passenger compartment area.

  • U codes: “U” indicates a problem with the vehicle’s onboard computers and integration functions that the OBD manages.

One would think that because the transfer case is apart of the drive train that the codes would be prefixed with “P”. Because GM did not do this, you MUST have a proper DTC reader that will be able to read C and B codes. Local parts stores may not have a reader that can read B and C codes.

There may be other causes, other than failed encoder motor, external to that of the encoder motor. These things are, but not inclusive, the dash switch, the transfer case control module (TCCM), the wiring between these electric components (past customers have found wires chewed by rodents!), low battery voltage (battery too weak to power the control module properly), and vehicle grounds. Diagnosing electrical problems can be tedious, but with proper tools you can rule out most of them.


Before Replacing encoder motor

If you have now determined that your encoder motor must be replaced please follow these very important guide lines.

  1. Make sure it is in 2WD High mode before removing the encoder motor. Failure to do so will require releasing the encoder-motor brake before you replace the encoder motor on the transfer case to index the motor to the shift rail correctly. You can do this with a scan tool and the motor plugged into the harnesses. It also possible to do this on the bench. You will need a 9-volt radio battery and two leads. Connect the positive lead to pin C (battery positive voltage) on the four-pin pigtail (orange wire) and the negative lead to pin D (lock control circuit), the tan wire. You should hear a click and be able to rotate the motor by hand. Use extreme caution not to over-travel the motor or else it will be expensive junk.

  2. Do NOT buy an aftermarket encoder motor. Sure they’re cheaper but there’s a reason for that. Also, avoid Dorman if at all possible. Some customers have installed up to 4 Dorman motors before they get one that works. In this instance, buy genuine GM encoder motor AC Delco, pay the price once, and not have to keep chasing electrical issues you think you have solved.

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