Transfer case fluid is black

I decided to check/change the fluid in the transfer case after having a leaking rear seal, and when I drained the fluid, I noticed it was BLACK. The fluid in the AOD transmission is still bright red. The black stuff from the t-case smells normal, not burnt. Any idea what could have caused this weird color?

T-case is BW 1345, was rebuilt in 2013 and I haven't checked it since then. Fluid level was fine.

I think that is normal for these t-cases as they have aluminum and/or magnesium cases and as the fluid moves around in there it picks up tiny bits of that and it shows as black.

Thanks, Gary! Do you happen to know if the speedo gear is lubed from the transfer case or from the transmission?

The drive and driven gears are lubed by whatever they are installed in.  In other words, if you have a transfer case then that's where those gears will be and they are lubed by it.  But if it is a 2wd truck then they are installed in and lubed by the transmission.

That's what I thought! My mechanic friend didn't know for sure, but we both reckoned that it was lubed by whatever it was installed in.

I have a sort-of related question. I noticed that when I installed the VSS/speedo into the back of the t-case, the cable wants to pop out of its retaining clip. I can get it pushed in, but if I rotate the gear, the cable will pop out again. Also, rotating the gear is much harder when the cable is installed. Is there something special that needs to be done here? I have installed a lot of speedo gears over the years, and not really had this issue.

It sounds like the speedo cable is stiff or jammed.  Can you rotate it easily with your fingers?

possibly an issue from being taken out. is it possible that it has slipped out of its position at the other end ? this could cause it to be jammed and do this. if you have a cruise control model then the in line signal generator could be where the issue is.

OK, so I had a chance to get in and take everything apart. The speedo cable was very hard to turn when the cable was all the way inserted into the VSS. So much so that it actually stripped the teeth off the driven gear.

I took the cable out of it's housing and cleaned it. Then re-lubed it with this stuff https://www.amazon.com/Finish-Line-Extreme-Fluoro-Syringe/dp/B002L5UL92

I put the cable back together and made sure everything was seated properly in the speedometer up top. Then underneath the car, I cleaned out the VSS, installed a new gear, and tried to put the cable back into the VSS. It seems like the cable itself if about 1/4 to 1/2 inch too long for its outer housing. If I were to cut off the end of the cable, it would fit perfectly.

I drove around with it almost-all-the-way-inserted and it stays in place. The speedo worked well, though it was a little jumpy in the 0-15mph range. I think for now I will just leave it in the "half-inserted" position and maybe order a new cable after while.


Questions:
Do you know if the speedo cable gets any lubrication from the transmission?
What do you use as cable lube?

My Transfer case was dark as well.  But I do not know when it was changed if ever.  The differentials were as black as night in the desert.  I remembered the smell well from my youth, and, that dark with the smell of it (unburnt) it is all normal.  

Most people do not change these fluids and they grow dark.  I rec. changing them every 50k at most.  It will extend life, though I know these days oil/atf is expensive.  Thanks Globalists!