Rear Differential Repair

Rear Differential Repair – Cost and All You Need to Know

Before we get into the rear differential repair cost it’s important to know what it is and how it works. It can be quite costly to fix the rear differential, and sometimes you might be better off selling your car as-is. Here’s all you need to know about rear differentials, and hopefully we’ll help you make an informed decision on whether or not you should fix your rear differential.

What is a Rear Differential?

In a nutshell, the rear differential’s role is to transfer power from your transmission (or transfer case if you have an all-wheel or four-wheel drive vehicle) onto your rear wheels. More importantly, the rear differential contains a set of gears that allows your rear wheels to rotate at different speeds.

Why is that important? That’s because your rear wheels have to travel at different distances while you’re negotiating a corner. The outside wheel will have to travel further, so it needs to rotate more quickly in order to keep up with the inside wheel. If they rotate at the same speed, the outside wheel will slip, making life uncomfortable for the driver.

Rear Differential Repair - Cost and All You Need to Know

For example, if you’re turning right, your left wheels (the outside wheel) will have to travel further. As a result, they need to rotate faster than the right wheel (the inside wheel) in order to keep up. Otherwise, the outside wheels will slip, making the car judder as you try to turn. Not a pleasant experience.

Unless you have a degree in engineering, differentials can be difficult to comprehend, especially in writing. It would be much easier with a visual aid, so here’s a video to help you understand rear differentials better:

Types of Rear Differential

There are several types of rear differentials used for different purposes. Here are the types of differentials you might find in a car:

Open Differential

An open differential is the most common type and the least expensive. For this reason, most cars use this and chances are your car has this type of differential. An open differential allows your car to go around corners smoothly, as explained above. However, power is often sent to one of the drive wheels with the least amount of traction or grip while driving.

That’s fine under most circumstances, but if you’re on ice or other slippery surfaces where the car struggles to find grip, it will simply spin the wheel with the power in place. Thus making it difficult for the car to move as it struggles to grip the surface. This means while an open differential works fine under most circumstances, it’s not great for high-performance cars and heavy off-road use.

Limited Slip Differential (LSD)

That’s where limited slip differentials, or LSD, comes in. An LSD has a series of clutches called clutch packs, this helps the car to limit its wheel slippage while maintaining power to both drive wheels, not just one of them. Meaning that even if one wheel struggles to find traction, the differential can still send power to the other wheel while limiting slippage. This in turn helps the car to find traction even in slippery conditions.

Porsche 911 GT3 - Rear Differential Repair

Because of the nature of their complexity, they are expensive and rarely found on-road cars, apart from high performance cars. LSD is instead often used in race cars, since they often need to send power to both drive wheels while coming out of corners. This helps the car to handle better and go faster.

Locking Differential

Often called a locker, a locking differential is able to lock the two drive wheels on axle together, meaning they have power at all times. However, this makes turning more difficult and rough, as both wheels must turn at the same rotation rate. Drivers must then disengage when making sharp turns, but often modern cars have an automatically disengaging locking diff.

Porsche Cayenne Off Road 121 - Rear Differential Repair

There are several types of locking differentials according to the way they are switched on or off, such as mechanical, electronic (e-locker), or using compressed air (air locker). Locking differentials are normally used for off-roading, as it helps the car to find traction in slippery conditions, but not particularly useful for normal driving.


A spool is basically an open differential, but the axles have been fastened together mechanically. This means that both wheels are going at the same rotation rate, much like the locking differential. However, a spool can’t simply be turned off, so its uses is usually limited to off-road competitions. It is cheap, so that’s one reason to use a spool instead of a locking differential.

You can learn more about the types of rear differentials in the video below:

Rear Differential Service

Just like any components in your car that grinds against each other, lubrication is very important for your rear differential. The gears inside the differential are bathed in gear oil, reducing friction between the gears which in turn prevents overheating. Similar to your engine’s oil, the oil will break down over time, and they will collect metal filings from the gears. As a result, they lose lubricity and increases friction between the gears. When this happens, it could cause more damage to your differential and your car if left unserviced.

Land Rover Range Rover AWD On Ramp

All this means you’re going to have to change the oil and perform a rear differential service. A rear differential service typically involves removing the cover, cleaning the remaining fluid inside, resealing the cover, and adding new lubrication fluids inside. After performing a service, most cars will go for about 20,000 to 40,000 miles before needing another service. However, this may vary between cars so you’d want to check your owner’s manual or your mechanic to see if your car might need servicing more often. Or for the sake of your bank account, hopefully less often.

If you do need to service your rear differential, the average cost is around $80 -$150 including labor costs. This of course varies depending on your car model. So, how can you tell that your rear differential is bad and in need of service? Or maybe even repairs? Well, here are some signs you need to look out for:

Signs of Bad Rear Differential

There are simply two symptoms of a bad rear differential, strange whining noises and leaking. Here’s how to identify them:

Whirring or whining noises

A rear differential that’s in need of service (or repairs) will make loud whining noises. The noise is high-pitched and tend to appear at speeds above 15mph, and it might vary depending on the speeds and load that’s put onto the differential. Here’s a video of an Acura RL with a bad rear differential to help you identify the noise:

Keep in mind that whining noises can be caused by a variety of things, from old tires to bad wheel bearings. Which means your rear differential might not actually be the cause of the weird noises you’re hearing in your car. However, strange noises in your car is never really a good sign, it would be wise to check and identify the cause of that noise and fix it, bad rear differential or otherwise.

Leaking from rear differential

If you’ve parked your car and notice a puddle of fluid underneath it, you might want to check that. Best case scenario it’s just water from condensation from your AC, which is nothing to worry about. Worst case scenario it happens at the rear of your car and it’s thick and grey-ish or brown, in which case it’s likely to be a differential leak.

If the latter is the case, then you’d have to check that to your trusted repair shop and be ready to repair your rear differential. The repair that needs to be done and cost will vary depending on the damage. Sometimes you will only need to change the seal, other times you’re going to have to do an overhaul. Which we don’t need to tell you will be expensive.

Types of Rear Differential Repair

JMB Land Rovers Services 6

As mentioned previously, rear differential repair will differ depending on the extent of the damage. If you need to repair your differential, it’s likely to be one of these:

Differential Gasket Replacement

Most cars will have either a rubber or a silicone cover for the rear differential. This cover will deteriorate over time as you drive, leading to leaks on the differential. This will be a fairly simple rear differential repair, as you only need to replace the cover.

All you need to do is take off the differential cover, clean the surface of the seal, and then reseal the cover. If everything goes well, it should take no more than an hour. In most cases, you will need to drain and refill with oil.

Sealing the Rear Differential Piston

In front of the rear differential sits a yoke which connects to your car’s driveshaft. Much like the seal, the yoke also has rubber parts on it, which will deteriorate due to ageing and develop leaks. In order to repair this, you will need to remove the yoke, pry out the seal, and drive a new seal into place. This requires more skill and is slightly more challenging as it’s easy to accidentally damage the new seal as you put it in place.

Sealing the Differential’s Side

Leaking differentials can also be caused by leaky side seals. The side seals are there to stop the fluid from leaking onto the rear brakes, which can be dangerous. Repairing the side seals is more time-consuming and challenging, as you will need to remove the axle shafts that connects the differential onto the wheels.

This process will require you to pry out the old seals and then installing new ones. Afterwards, you’ll have to put the entire assembly of the differential and axle shafts together again.

Replacing Rear Differential Bearing

There are bearings inside your rear differential, which includes the pinion and side bearing. Both bearing can deteriorate over time, which in turn will lead to noises coming from your differential. Replacing one of the bearings will take anywhere between three to five hours, and it will be more expensive due to the complexity.

Replacing Rear Differential Gears

As mentioned previously, inside the rear differential sits several gears that makes the system work. Just like any other gears, the teeth may wear down significantly or even chip. Once this happens, you will hear noises and can eventually lead to total failure. Therefore, you will need to replace it once that happens.

Replacing the differential gears will be very costly as it’s crucial for the differential to work, so be prepared for a hefty bill.

Rear Differential Repair Cost

The cost to replace your rear differential will vary depending on what type of repair you will need to do. If you’re lucky, you’ll only need to do some light repairs and it won’t cost too much money. For example, a differential carrier bearing for a Toyota Camry costs just $38 each. However, this does not include labor cost which is usually around $80 – $120 for a rear differential repair job.

On average, you can expect to pay between $200 – $400 for a lighter repair job on your rear differential. However, heavier repairs will obviously cost you more money, depending on the type of work. For example, a differential carrier case (the unit which the ring gear bolts to and transfers power to the axle shafts) is a larger component in the differential, and can cost up to $500 for you to replace.

For heavier repairs, we recommend you prepare yourself for a service bill of anywhere between $500 – $800.

Rear Differential Replacement Cost

Prepare yourself, this one’s a doozy. If you’re really unlucky then you might need to replace the entire rear differential assembly, in which case you’re definitely going to pay above $1500 for a replacement job. For example, a rear differential assembly for a Toyota Camry (2006 – 2020 model year) is going to cost you nearly $1200, and that doesn’t include labor.

Mercedes S Class S 400 Hybrid 0053 1200x800 - rear differential repair

If you own a larger car, such as a Toyota Tacoma for example, that’s at least $2400 for an entire unit. Then we get to the luxury cars, if for example your 2014 Mercedes-Benz S-Class needs a rear differential replacement, then it’s going to cost you $3100. Even with a discount, you’re still going to have to pay somewhere in the region of $2800, not including labor. You can easily pay between $2000 to even $5000 for a rear differential replacement job in a luxury or performance car.

If you’re a bit cash-strapped, then maybe it’ll be better for you to look for a high-quality secondhand unit. However, even this will still probably cost you over $1000 depending on your vehicle model. If you do plan on using a secondhand unit, remember to find one with a solid warranty. So if anything goes wrong, hopefully you’ll still have a warranty and can replace the faulty differential for little to no money at all.

As for the labor cost itself, it’s usually around $85/hour for a replacement job. However, labor cost may very between shops and vehicle types. So, remember to shop around to get estimates and find the best possible value and service for your car.

Common Questions about Rear Differential

What Causes a Rear Differential to Go Bad?

Much like other components in a car, a rear differential can go bad simply because of ageing. As they get older, the oil breaks down and parts wear down, sometimes leading to damage. In most cases, you should be fine for up to five years. However, remember to properly maintain your car, and service your rear differential should you need to. This way, hopefully you can avoid a rear differential replacement during your ownership.

Can You Drive with a Bad Differential?

Technically, you can drive with a bad differential, but it would be unwise to do so. A differential is a crucial part to the car’s drivetrain, leaving it unserviced or damaged might make driving uncomfortable, and even dangerous. Not to mention it might affect and damage other components as well.

What Happens When a Rear Differential Completely Breaks?

Driving with a bad differential can lead to different scenarios. A chipped or broken gear may cause vibration and loss of power, in worse scenarios it can make handling a nightmare. You might lose control of your car as it struggles to corner with a bad differential, endangering you and everyone around you.

The worst-case scenario would be full loss of power, and eventually complete break down. In which case, you will stop, unable to move or even start, leaving you stranded at the side of the road waiting for help. Which, we don’t need to tell you, isn’t a pleasant experience.


Should You Repair or Sell the car?

Rear differential replacement or repairs can be costly and time-consuming. So, if you find yourself in this situation it would be wise to weigh your options first. Light repairs should cost no more than $400, in which case you probably should just go for the repair. However, heavier repairs or replacement can be more costly. In which case, you might want to consider selling your car as-is.

It would be wise to sell your car as-is in certain circumstances. For example, if your car’s resale value is barely more or even less than the repair cost, you might want to just sell your car as-is. It’s simply not worth it to fix the car for a huge amount of money, only then to sell it for barely more than the repairs you have paid for.

If you’ve also been doing a lot of repairs lately, we also recommend selling it and instead look for a more reliable or even a new car. You’d have to judge on your own on whether or not the car is still worth keeping, but if you’ve been doing lots of repairs and it’s starting to put a strain on your bank account as well as taking a lot of your time, it’ll probably be better to get rid of it.

Of course, a car can sometimes have sentimental value and is more than a form of transport. Maybe you’ve had some great road trip memories, or maybe it’s been in the family since you were a kid, in which case we understand if you don’t want to sell it and want to repair it instead. Whatever the case, remember to check regularly and repair your differential should you need to. As we’ve said, driving with a bad rear differential can be uncomfortable and even put you in significant risk.

Selling a Car with a Bad Differential

Selling a car with a bad differential can be tricky, as the differential is essential to the car’s operation and you might struggle finding a buyer. Worst case scenario is you’re going to need to scrap your car, offering it to a scrapyard. In which case, they’re essentially only paying for the metal value of your car, as they would probably throw away the other and possibly still functional components.

If you have the time and the skills, you can take apart your car and sell individual functional parts yourself. Afterwards, you can simply scrap the rest of the car that you can’t sell on your own. This way, you can get more value out of your broken car, sometimes even more than the resale value. However, we understand that not everyone has the skill or time to do so, so it’s not an entirely viable option.

Best case scenario is you’d find a used car lot or buyer that’s willing to take it off your hand, but it’s likely you’re going to sell it for a lower price than the market value. Your buyer is likely to deduct your asking price with the cost of the repairs that needs to be done. In which case it’s like you’re paying for the repair anyway.

In any case, remember to routinely service and maintain your car, as this can help you to avoid large and expensive repair jobs in the future, such as rear differential repairs. It doesn’t hurt to give your car the attention it deserves.

Approved Tools

These tools have been tried and tested by our team, they are ideal for fixing your car at home.

Leave a Reply

Your email address will not be published. Required fields are marked *