All You Need to Know About the 263hd Replacement Unit


The 263HD transfer case is a transfer case for some GM and Chevrolet 4WD vehicles. This transfer case is built as a replacement unit to solve the “pump rub” issue. 

The pump rub issue occurs when the fluid pump in the transfer case wears the case. These transfer cases usually use a gear-driven pump inside the case and are driven off the main shaft. The pump rub issue affects 4WD vehicles from 1997 to 2010 and usually develops slowly; hence only noticeable once significant damage has occurred. 

This design demands that the pump float in the rear half of the case. The GM case had four tabs to ensure the pump remained in its location in the housing. The GM case also had a steel spring installed to prevent wear. 

However, this isn’t sustainable as after some time, the steel spring clip can wear or even break. When this happens, the pump housing starts to wear out as the pump is made of aluminum while the casing is magnesium. The wear causes pin-holes to develop on the soft magnesium case, which leads to the leak. 

It is challenging for a truck owner to tell as most of the leak occurs in the case. This phenomenon occurs because of the pump’s positioning inside the case. This means the leak happens when the truck is moving and hence doesn’t leave a huge paddle. It is thus tough for a truck owner to know this is happening until the transfer case has emptied all the fluid.

The 263HD Replacement Unit Upgrades

Thankfully, the new and improved 263hd transfer case is the solution to the “pump rub” issue. The old one had a 2.72:1 ratio with a magnesium case, while the new ones come with an aluminum casing eliminating the pump rub issue. Aluminum is hardy and thus more durable against tear and wear than magnesium. This prevents the development of pin-holes, hence the leak.

The new 263HD transfer case also comes with an upgrade that corrects the steel spring clip issue making it even more durable. If the pump is held in place longer, it prevents it from rubbing against the rear casing, thus developing holes and ultimately the fluid leak. 

The new replacement unit also comes with updated pumps and a case saver in case of future rear case failure issues. The improved pump help prevent the wear of the rear compartment in case the spring clip fails again. 

The case saver is an insurance policy to prevent leaks if the pump causes pin-holes to develop on the outer case. The case saver will prevent the fluid’s evaporation, hence preventing the transfer case drain.


The pump rub issue is a problem that is very costly to try to repair and very difficult to tell when it is happening. It is a problem that will affect all GM and Chevrolet 1997- 2010 truck owners. You better get a 263HD transfer case replacement unit earlier rather than wait to repair the case. 

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