The transfer case is an essential part of the powertrain system in vehicles with four-wheel drive or all-wheel drive. The function of this component is to transmit the power coming from the transmission to the front and rear axles. It is also responsible for synchronizing the difference between the rotation of the front and rear wheels. Generally, the transfer case has one or more sets of gears through which the power from the transmission is received and sent.
The ABS (Anti-lock Brake System) control module is responsible for monitoring the operation of the transfer case. If the transfer case has an unstable operation, a fault code will be stored, and this code will alert the situation. In the case of the C1500 OBDII code, it is set when a failure occurs in the transfer case encoder circuit.