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My 2002 Silverado originally had a "Service 4x4" message appearing on the dash.. and though I didn't realize it, my 4 wheel drive was not working/engaging. Then came a day when it got stuck in 4 wheel low and was no longer driveable. I took it to Chevrolet and they told me that they had code C0327 - Encoder Motor problem and that it was blowing the fuse as soon as they connect it so they couldn't get it back to 2 hi. I paid their $75 fee for the analysis and took the truck home. Eventually I found a great deal on an encoder motor on ebay that had been mismarked with no effectivity listed. After verifying it was the correct NP8 motor (Dorman), I bought it for $65 shipped and began the installation. Chevy wanted $850 for the repair. Here is how I changed this part and fixed my truck. Jack it up, put it in neutral, disconnect the battery,andpull the fwd. short drive shaft. The boot/cover at the rear of this shaft can be popped off with a tire iron (gently). Remove the encoder motors 3 main bolts (15mm) and save the plastic gasket unless it's damaged. If it is you'll have to get a new one. Then to begin the new part installation, you'll want put the new motor up in place without the gasket and check alignment of the motor shaft/cam slot with the transfer case shaft/cam. On mine...because it was stuck in 4 wheel low... it didn't line up. After trying several combinations of starting the truck and shifting to drive, reverse, and neutral then shutting it off... I was unable to move the transfer case. Even with a wrench it felt like I was going to break the shaft as it was real spongy and didn't stay in a commanded position. So... after reading many threads on many forums that told me DO NOT put power on the new motor to move it... I found several threads that said cut a few foot long pieces of wire and touch them to the 4 pin connectors large red & black wires). These were the motor wires. When you do this be sure to make quick short movements of the motor. Trouble comes when you go too far with your movements. It took me 3 attempts but I finally got it to align and the installation went smooth after that. Install the encoder motor w/gasket (you may have to adjust the wiring/clamp to get clearance) and then connect your 2 connectors. Then the drive shaft, battery, start the truck, put it neutral, and press your 2 hi button. For me, it's working great now. Problem solved... so the bottom line is, you can put 12v to this motor to adjust it to where you need it as long as you do it carefully!
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