Removal and Replacement

The catalytic converter is located next to the transfer case. Due to the extreme temperatures generated by the converter it should be allowed to cool before attempting any repair procedures.

1. Raise and support vehicle, then position safety stands under vehicle.
2. Remove skid plate from frame, if equipped.
3. Remove vibration damper from transfer case, if equipped.
4. Drain fluid from transfer case into container.
5. Disconnect the four wheel drive indicator switch wire connector at the transfer case.
6. Disconnect the front driveshaft from the transfer case output shaft yoke, then using mechanics wire support shaft out of way.
7. Disconnect the rear driveshaft from the transfer case output shaft flange, then using mechanics wire support shaft out of way.
8. Disconnect the speedometer driven gear from the transfer case rear cover.
9. Disconnect the vent hose from the control lever.
10. Remove the nut from the shift lever, then remove shift lever.
11. Remove the large bolt and the small bolt retaining the shifter to the extension housing.
12. Remove the lever assembly and bushing.
13. Support the transfer case with Rotunda Transmission Jack tool No. 077-00019 or equivalent.
14. Remove the five transfer case to transmission retaining bolts.
15. Slide transfer case rearward off the transmission output shaft, then lower the transfer case from vehicle.
16. Remove and discard gasket from transfer case sealing surface.
17. Using a small amount of Premium Long Life Grease part No. XG-1-C or -K, install new gasket on the front mounting surface of the transfer case assembly.
18. Raise the transfer case with the transmission jack, then align the transmission output shaft with the splined input shaft of the transfer case. Slide the transfer case forward onto the transmission output shaft and alignment dowel.

Fig. 4 Transfer Case Mounting. Borg-Warner Model 1354:

19. torque transfer case retaining bolts to 25-35 ft lb in sequence shown in Fig. 4.
20. Remove the transmission jack from the transfer case, then install and adjust the shifter. Tighten the large shifter retaining bolt, then the small retaining bolt.
21. Install the vent assembly so the white marking on the hose is in position in the notch in the shifter. The upper end of the vent hose should be 3/4 inch above the top of the shifter and positioned just below the floor pan.
22. Connect the speedometer driven gear to the transfer case rear cover. torque retaining bolt to 20-25 inch lbs.
23. Connect the rear driveshaft to the transfer case output shaft flange. torque the retaining bolts to 61-87 ft lb
24. Connect the front driveshaft to the transfer case output yoke. torque retaining bolts to 12-16 ft lb
25. Connect the four wheel drive indicator switch wire connector at the transfer case.
26. Install the drain plug, then torque to 14-22 ft lb
27. Fill transfer case with Motorcraft Mercon Multi-Purpose Automatic Transmission Fluid XT-2-QDX or -DDX or equivalent to bottom of fill hole.
28. Install fill plug, then torque to 14-22 ft lb
29. Using new damper retaining bolts, install the damper to the transfer case. torque retaining bolts to 25-35 ft lb
30. Install skid plate, then torque retaining bolts to 15-20 ft lb