Rear Differential Replacement Cost: Here’s What You Need To Know

Rear differential replacement is expensive and if your differential is noisy or obviously broken or in need of repair, you are looking at a high cost. The gears inside the differential are covered in a lot of oil that lubricates and keep it running smoothly.

One of the things that can happen is that the oil gradually leaks out. You may notice grayish fluid on the ground underneath your vehicle, the oil will need replacing and the ring gear will need to be changed. The differential is a part of the drivetrain and allows the wheels to turn at different speeds, so as you can see it is important.

In more serious cases the differential could be cracked or broken especially when the vehicle travels over rough terrain regularly. If the mechanic says it is broken it will need replacing immediately as waiting may cause further damage.

What is a Rear Differential and How Does it Work?

With a car, the differential allows the outer drive wheel to rotate faster, and an increase in one wheel’s speed is balanced out by a decrease in the speed of the other wheel.

A differential connects the longitudinal propeller shaft to the pinion that drives something called the transverse ring gear. If the longitudinal propeller shaft breaks or cracks it will certainly need replacing, as the power will longer be directed to the rear wheels.

A rear differential repair that requires new gears can be costly as you may be looking at a rear differential replacement. The differential is a mechanism with sprockets like a gearbox that allows wheels to rotate at different cornering speeds while holding traction.

Rear differential of SUV vehicle.

If something goes terribly wrong it requires rear differential replacement, so it is important that we look after the car to prevent this from occurring.

The Different Types of Differentials

  • The spur-gear differential has two spur-gears of equal size. Torque from the drive shaft of the car rotates this system.
  • Epicyclic differential uses epicyclic to split torque between the rear and front axles, often found in more recent cars, an example is the Toyota Prius.
  • A limited-slip differential is a welded differential. This makes the wheels turn at the same speed. Allows the driver to get the car to slide through a corner without skidding off the road. Popular in some cultures, as a means of getting around tight corners or on ice and snow.
  • Locking differential. The traction-aided differential supplies equal torque to each side.
  • Torque-Vectoring differential. Volkswagen Golf has an electronically controlled front axle. Meaning each wheel has its own differential. This allows more power to be sent to the wheel that most needs it.

Rear Differential Replacement

  • The rear differential seal can need replacing, and this is specialist work as it can be hard to remove.
  • The differential gasket sometimes needs replacing, this takes less time. Remove the cover, and clean and reseal it.
  • Rear differential bearing replacement will take 2-3 hours and may be the reason for the noise the car is making.
  • Teeth on the gears become worn and may need replacing, this is both expensive and time-consuming.
  • Complete rear differential replacement could be required, and this is expensive.

What Are The Signs of a Bad Rear Differential

Oil leak in the car’s engine.

You may notice a grinding whining sound emerging from your car, especially when taking a corner. This could mean that the car is low on lubricating fluid, and the moving parts are beginning to dry out.

Always check under your car for leaking fluid, as this can mean that a seal needs replacing, look for oil on the garage floor.

Another thing you may notice is uneven wear on the tires usually evident on the inside of the tire.

Something like vibrating during acceleration is an early symptom that the differential is failing.

Eventually, all cars fail, and if the damage is too extreme it may be a better option to purchase a new car.

What Are The Repair Options for a Rear Differential?

The type of differential that your car has will mean that the maintenance is difficult or easy. A self-locking differential that locks the wheels is much more complicated and would require removing the clutch and springs to fix it.

If you use the drifting mechanism to get your car around icy corners in winter, you will need to have your welded limited slip differential in tip-top order.

Rear differential replacement can be unavoidable, and if your vehicle becomes unstable while you are driving it, you will find you are unable to handle it and should pull over immediately. It may be because there is damage to the rear differential, and it is important that this is diagnosed as soon as possible.

Just like all things mechanical, lubrication is important for your rear differential. Like the oil in your engine, over time the oil will break down, and wear and tear causes it to lose its lubrication properties.

This is why we take the car along for an oil change and a rear differential service. Most garages recommend this type of service between 20,000 and 40,000 miles (quite a long time). Problems that may be identified at this service are:

Mechanic is repairing the car wheel system in an auto shop.

1.     The Whining Noise

Often high pitched, and may not always be the rear differential, but the noise should certainly be checked out during the service. When you are turning into a corner, you may notice the noise increasing and then subsiding again and damage could be caused by the following.

2.     Oil Leak

As mentioned before, there could be a slight oil leak when you park the car overnight. Look at the garage floor and make sure that it is not just condensation. If oil is leaking it may be as simple as just changing the seal. Always use the oil recommended by your car manufacturer in the differential.

3.     Differential Gasket Replacement

Over the rear differential will be a rubber or silicone cover. Over time the cover will deteriorate and it will need to be removed and the surface seal needs to be cleaned. Once it is clean it can be resealed, and this is one of the easiest rear differential repairs taking about 1 hour.

4.     The Piston

The car’s drive shaft is connected to a yoke and in front of the yoke is the driveshaft. The yoke has rubber parts and they will also deteriorate and need replacing. Get the mechanic to do this for you as it can be tricky and should be done at the time of service.

5.     Sealing the Differentials Side Seals

Leaking differentials can also be caused by side seals that leak. They are there to prevent the fluid from leaking into the brakes. If this occurs the mechanic needs to do the repair as it means removing the axle shafts and repairing the side seals.

6.     Rear Differential Bearing

The rear differential replacement may mean the bearings are worn out. There is one on either side, the pinion and side bearing. These can be the causes of noise coming from the differential, they are hard to remove, so get the mechanic to do it during the service as they take a few hours.

7.     Gear Teeth

The gear teeth in the system may become worn down or even chipped. This leads to quite a loud noise, and if you find this happening it may be cheaper to replace the car than the gears.

8.     Repair Rear Differential

Rear differential replacement versus repair can be costly, but it depends on what has to be replaced. If a repair is under $400 it is not costly and is worth doing to have your car roadworthy again, and minor repairs can be assessed by your mechanic and done in a couple of hours.

9.     Rear Differential Replacement Cost

If you have to replace the whole rear differential assembly, this is not good news, and if you have a luxury car you may end up paying a fortune.

If you are unlucky enough for this to happen you may be able to source a secondhand unit with a warranty. Labor costs for this type of work are very expensive. However, the option of not having it done is no car, so it has to either be repaired, or buy a new car.

Tip: A rear differential can be expensive, so definitely weigh up your options before commencing the repairs. If your car is only worth what the repair will cost it is better to sell the car and get a new one, as it is not worth fixing a car when something else will most likely go wrong.

Should you decide to sell the car as is, this won’t be easy, and if you decide to sell the car for scrap, take the time to remove all the functioning components. In many cases, a used car dealer will take it off your hands and have it repaired himself at a lower price for you.

If your car has a bad differential requiring rear differential replacement, it is not a good idea to drive it as it deems the car unreliable, and you may have to end up getting it towed, which adds further expense.

The rear differential is important as it allows the car’s wheels to rotate at different speeds, creating a safe turn through corners. A dodgy differential can accelerate wear and tear on the transmission. This would increase the friction and gradually wear down the differential.

This is why having a frequent oil change is so important to the functioning of the vehicle, as it lubricates the working parts. So check the differential oil for any metal shavings that could indicate wear and tear, showing that the metal wasn’t being properly lubricated.

How Much Does it Cost to Replace/Repair a Rear Differential?

Keeping your differential in good repair is essential, and sometimes when you hear a slight noise, you can fix the differential by changing the oil.

Try this first, and if it doesn’t work take the car to the mechanic.

  • A worn bearing will cost $200-$400.
  • A piston and bearing $400-$800.
  • A gasket sealing and bearings even more at $1,500 to $4,000 (takes about 5 hours to complete)
  • Differential gears are costly at more than $2,000.
  • A brand new component differential replacement fitted is around $4,000, often extra for labor.

All this is far too important to ignore and if you do ignore it, it could lead to accidents. So rear differential replacement is not cheap and is carried out by the workshop mechanic using specialized tools.

If you had to purchase all the right equipment to do the work at home it would cost over $1,000 USD, so it is better to take the car to the mechanic even if you think that you could do the work at home.

Many new cars now have a five-year warranty when purchased from a dealer, and after that time, it is a good idea to consider trading them in. To do this means that if you can afford a new car every five years you are constantly under warranty, and most issues are covered.


Depending on the mileage that you do every year, you may never have a problem or need rear differential replacement.

If you buy a used car, you do need to be careful, and before you pay for it get the car thoroughly checked by a mechanic to be certain that there are no looming problems with any mechanical parts, especially the differential that is expensive to fix.

As mentioned, a bad differential can accelerate wear and tear on your other car parts and it is terribly important as the differential allows the power to be transferred from the transmission to the wheels. If a rear differential breaks it would most likely render the car undrivable leaving you stranded.

Sometimes, but not always the car is still able to be driven, but then you have the huge cost of repairs. Just like all things mechanical repairing a differential is a job for the experts.

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About Brock Rangel

Hi, I am Brock, and I am the lead editor/photographer for TheCarColony. I have been a mechanic for over 14 years now, and I am here to spread my car knowledge across the web!

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