Four problems related to transfer case have been reported for the 1998 Ford Expedition. The most recently reported issues are listed below.
1998 Expedition cruise control was disconnected. When it was reconnected there was a sudden vibration. The consumer was informed of a recall on the cruise control in September 2005 and had it disconnected while waiting to have it fixed. On December 28, 2005 the cruise control was reconnected but wasn't use until January 2006. When it was finally used there was a vibration. The vehicle was parked and the consumer observed fluid leaking onto the driveway. The vehicle was taken to the dealer who stated that there was no was that the vibration was connected to the recall work. The vehicle was taken to the consumer's regular mechanic who determined that the transfer case bushing was damaged along with the driveline and transfer case. All parts had to be replaced.
We were on vacation June 27, 2004 and our 1998 Ford Expedition broke down 15 miles outside of flagstaff, az. We were towed to aamco transmissions, whom after getting authorization from our service contract to check our truck found that a seal gasket in our transfer case had melted and all the oil ran out. These are supposed to be covered for 150,000 miles, our truck is at 92,184 miles. I have a service contract covering me for 96,000 miles. They refused to fix it because they said it was tampered with first, then they said the transmission wasn't covered, then it was because we drove it with no oil. Aamco told them us the part was covered under our service contract but that they get this alot from service contracts where they don't want to pay for the work. Aamco also said that these trucks do not have indicators on the transfer cases to show that anything is going wrong or that oil is leaking. We have never had problems. Our r oil levels were checked on June 25th before taking off for vacation and everything was fine. We have never had leaks. We had 3 of ouryoung grandchildren with us. We were driving on a freeway and our truck just started slowing down really fast and were lucky there were not many cars at that time so we could pull off the side of the freeway. So you can see that this thing could lead to accidents if someone is driving and all of a sudden your vehicle slows down in heavy, fast traffic because you have no way of knowing this is happening or anything is happening with your truck. We are having this fixed at our expense, seal gasket in the transfer case?, $1700 + $240 labor to check it and take it apart. I will never buy another service contract after this on a used vehicle. I bought my truck from chapman Chevrolet who since changed their name to freeway Chevrolet in chandler, az and they were not willing to help me with this service contract which I bought from them.
While operating the vehicle at about 20 mph, it droped into 4 wheel low range completely on its own. The dash switch was still in 2 wheel drive. The transmission began screaming and grinding gears and would not come out of 4 wheel low. Vehicle was towed to Ford dealership where they found nothing wrong. After reporting these NHTSA complaints and service bulletins about this very same problem, and providing the service manager with copies, they suddenly found the problem. They are replacing all the components including "mode switch" gem module, 4x4 shift motor. They'll also check all connections, change all fluids including transfer case and transmission. We've been assured this will resolve the situation. We'll submit a follow-up report if problem recurs.
Shortly after purchase transmission leaked , had to be repaired. Currently, transmission squealed. Took vehicle to dealer, who found a leak. Also, transmission was tearing itself up, and had to be replaced. Transfer case broke and drive shaft was shuddered. Steering was very loose due to lower steering shaft failure.