E36 Differential swap DIY

Step 1: Get the car way up in the air safely secured on jack stands. I used a small jack to lift under one of the front jacking pads. Then I slid the large jack under the front of the car and lifted it. Insert two large jack stands under the front pads. Then I moved the large jack to the back and lifted it as high as I could. And, you guessed it…insert two large jack stands under the pads.

Step 2: Remove the sway bar. This isn’t really necessary, but really makes things easier later on. It’s easy to do, so as Nike says, “Just do it.” First remove the top mounting nuts from both sides (pictured is the driver’s side):

Next remove the chassis mounts for the sway bar. Again, the driver’s side is pictured. It won’t fall right away, so don’t fret….

Lift up on the sway bar to slide the mounting tabs from the chassis. Now the sway bar is free. The next step is to snake it out of position. Merely rotating the orientation of the driver’s side endlink (as shown below) made it a no-brainer.

Step 3: Remove the cat-back exhaust. This can actually be done prior to Step 2, it’s up to you. The first thing to do is loosen all of the front muffler clamps. Looks like a previous owner of my car replaced one of the BMW clamps with one of those high dollar European ones.

The next step in getting the exhaust out is to remove the two nuts holding the hanger clamps to the muffler. Feel free to use my patented “foot method” to aid in removing the exhaust. The muffler comes downward and the pipes slip off of the cat pipe.

Step 4: Loosen the diff from the drive shaft. Set the e-brake and/or put the car in gear. I used a QuickWrench to break these guys free. This is the first time having a buddy around will be helpful. Give him a beer and sit him in the car. It will allow you to loosen all four bolts while your buddy releases the e-brake (or puts the car in neutral) so you can rotate the drive shaft for bolt access. Space is moderately tight, but you don’t need to remove the flexible shield under the drive shaft.

Step 5: Remove the torx bolts with a E12 Torx socket. Now is the only time you’ll ever use those inverted torx sockets you bought. IMO, this is actually the hardest and certainly the most tedious part. The bolts are likely caked up with road grime. If you don’t get the socket firmly onto the bolts, you will easily strip the heads of the bolts. Do not rush this! Only break loose the bolts you have easy access to (typically up top because the axle boot gets in the way down low). Then have your buddy release the e-brake (or put it in gear) as needed. He’ll probably want another beer at this point, too.

If necessary, use a hammer and tap the socket onto the bolts to make sure you get them firmly seated. Again, do not rush this! I’d actually recommend buying a dozen new torx bolts for the re-install, but it all depends on how safely you remove them. Feelin’ lucky? Well, are ya…punk?? :

Here’s a better view of the torx bolts and plates coming out. Note the easy access with the removal of the sway bar and muffler! When you get all the torx bolts out, I recommend zip tying the axle shafts up high to keep them out of the way when dropping the diff. Trust me…

Here’s a close-up of the axle shaft pulled away from the diff. flange. You can’t see the zip ties in the picture, but they’re in there!

Step 6: Remove the Diff! There are three bolts holding it in. Two up top in the “ears” of the housing and one in the passenger side front of the the housing. I removed the front one first.

The bolt is long and may not want to come out easily. Push up on the housing to relieve some tension and the bolt will pull right out.

Now just barely break loose the two rear bolts, but do not remove them!

Now move your jack under the housing, and then remove the last bolts in the “ears.” Note the zip ties holding the axle shafts out of the way. Unplug the speedo sensor being careful not to break any of the plastic. The diff is about to come out! This picture shows the problem of the Rear Axle Carrier and trunk better. You have to rotate the diff out onto the jack.

Feed your buddy another beer ’cause now it’s time for him to do some labor! Carefully lower the jack while supporting it from either side. It weighs about 85-90 lbs. so be careful. It’s an easy job with two people, though. Wheel it out on the jack as such:

Free at last! Free at last! Thank God Almighty, it’s free at last!

Okay, so it’s out! Now bask in the glory of how naked the underside of your car is. All right, now it’s time to get back to work, you sicko!

Depending on the car you have and what the diff came out of, you may have different input and output flanges. Mine had a four bolt input flange, as did the unit I bought. However, note how they are different shapes. No matter. I measured the critical dimensions and all were the same so I used the round one that came with the new diff. Dig my groovy safety glasses, baby!

If you find that you do have to change the input flange, impact the input flange nut off (securing the output flanges as shown below, preferably with the help from your buddy Otis) and use a gear puller to easily pull the flange off:

My flange wasn’t torqued. And my socket was too large to fit, so I turned it down on my bench grinder. My kingdom for a lathe! Torque according to the Bentley (129 ft-lbs, if I remember correctly) being sure to prevent the output flanges from spinning. It can be tricky, so ask your buddy for help securing the diff while you torque it. He should be drunk enough by now that you can push him over while he does it. If you need to swap the output flanges (I didn’t), it’s super easy. Just use a pry bar and pry them out of the housing. There’s a snap ring keeping them in place, but not very securely. The new ones just push back in place. Use a rubber mallet (softly) as needed.

In my case, the speedo sensor on the “new” diff was smashed so I replaced it with the one from my original diff.

Installation is the opposite of removal, so scroll up the thread. BIG thanks to my buddy, Zac, for helping and grabbing pics. And, no, he didn’t get drunk. He had to drive home in the snow afterall (yes, we’re in Texas!).

As always, do this at your own risk and if you don’t feel comfortable doing it, leave it to a pro…or someone you can con into it. Hope this helps some of y’all.

Enjoy and happy burnouts!

Torque Specs from Bentley
Drive axle to final drive flange
M8 Torx Bolt: 47 ft-lb
M10 Torx Bolt: 74 ft-lb

Final drive input shaft to pinion
4 Bolt: 129 ft-lb (or until match marks line up)
6 Bolt: 137 ft-lb (or until match marks line up)

Caution: If the input flange nut torque is exceeded, or the nut is tightened past the marks, the crushable collar sleeve behind the flange will need to be replaced. This operation required disassembly of the final drive unit

Differential drain and fill plugs: 52 ft-lb
Final Drive carrier to body: 57 ft-lb
Final Drive to carrier, front mount: 70 ft-lb
Final Drive to carrier, rear mounts: 57 ft-lb

Driveshaft to final drive flange:
With CV Joint (M8): 23 ft-lb
With U-Joint (M10 ribbed nut): 59 ft-lb
With U-Joint (M10 compressed nut): 44 ft-lb

“Do this procedure at your own risk. Follow manufacturer’s guidelines and specifications. If in doubt of your abilities, please leave this to a professional.”