P0720 Code: Output Speed Sensor Circuit Malfunction

A P0720 code means the TCM is not receiving a usable signal from the output speed sensor (OSS). This sensor reads the rotational speed of the transmission output shaft — which directly correlates to vehicle speed. Without it, the TCM cannot calculate gear ratios, the speedometer may read zero, and the transmission will likely go into limp mode or refuse to shift properly.

The output speed sensor is one of the most important sensors in the transmission control system. It works hand-in-hand with the input speed sensor (P0715) to give the TCM the data it needs to control every shift. When one goes down, the whole shift strategy falls apart.

How the Output Speed Sensor Works

The output speed sensor mounts on the transmission case — usually on the tailshaft housing or near the output shaft seal area. It reads a toothed ring (reluctor) on the output shaft or the differential ring gear, depending on the transmission design.

Just like the input speed sensor, it comes in two flavors:

Variable Reluctance (2-Wire)

A permanent magnet wrapped in a coil. The reluctor teeth create a pulsing magnetic field that generates an AC voltage. The TCM counts the pulses to calculate RPM. At low vehicle speeds, the signal is weak (0.2–0.5V AC). At highway speeds, it ramps up to several volts. Typical resistance spec: 200–2,000 ohms depending on manufacturer.

Hall Effect (3-Wire)

Needs an external power supply (5V or 12V reference), a ground, and outputs a clean digital square wave. More reliable at low speeds because it does not depend on shaft speed to generate its own voltage. If the reference voltage is missing, the sensor is completely dead.

What Happens When the OSS Signal Is Lost

• Speedometer drops to zero: On many vehicles, the vehicle speed signal for the instrument cluster comes from the OSS (either directly or through the TCM/PCM). No OSS signal = no speedometer.
• Transmission goes into limp mode: Without knowing output speed, the TCM cannot calculate gear ratios or control shift timing. It defaults to a safe gear — usually 2nd or 3rd — and stays there.
• Harsh or no shifts: The TCM may refuse to upshift or downshift because it does not know how fast the vehicle is moving.
• ABS/traction control codes: Some vehicles use the OSS signal as a cross-reference for the ABS module. Losing it can trigger ABS and traction control warnings.
• Cruise control disabled: The cruise control system needs a vehicle speed signal to function. It will not engage without one.

Step-by-Step P0720 Diagnosis

Step 1: Confirm with Scan Data

Pull up the TCM data stream and watch the output speed PID. Take the vehicle for a drive (or put it on a lift). The output speed should increase proportionally with vehicle speed. If it reads 0 MPH while you are moving, the signal is dead. If it reads erratically (jumping between 0 and a high number), the signal is intermittent — suspect a loose connection, damaged reluctor, or failing sensor.

Step 2: Check the Vehicle Speed on the Speedometer

If the speedometer also reads zero while driving, that confirms the OSS signal path is broken. On vehicles where the speedometer uses a separate VSS on the transfer case or the ABS wheel speed sensors, the speedometer might still work even with a bad OSS. Know your vehicle's speed signal routing.

Step 3: Locate and Inspect the Sensor

The OSS is typically on the side or rear of the transmission case. On FWD vehicles with transaxles, it is often near the differential section. Remove the connector and inspect for corrosion, ATF contamination, or bent pins. Check the sensor mounting — make sure it is seated fully and the O-ring is not preventing full engagement. An air gap that is too large weakens the signal on variable reluctance sensors.

Step 4: Test the Sensor

Variable reluctance: Unplug the sensor. Measure resistance across the two terminals — should be 200–2,000 ohms (check your specific spec). OL = open coil, replace it. Then backprobe the connector with your DVOM on AC millivolts. Spin the output shaft (transmission in neutral, turn the wheel on a FWD vehicle). You should see AC voltage pulses. No voltage = dead sensor or damaged reluctor.

Hall effect: With the sensor unplugged, check for reference voltage (5V or 12V) and ground at the harness connector, key on engine off. If reference voltage is missing, trace it back to the TCM. If power and ground are good, reconnect the sensor, backprobe the signal wire, and look for a toggling square wave while spinning the shaft.

Step 5: Check the Wiring

Unplug both ends — at the sensor and at the TCM. Test continuity on each wire. Should be less than 2 ohms. Check for shorts to ground (should be OL). Check for shorts between wires (should be OL). Pay special attention to the section of harness near the exhaust — heat damage is common.

Step 6: Inspect the Reluctor Ring

If everything electrical checks out, the reluctor ring may be damaged. A chipped or cracked tooth creates an erratic signal pattern. Some sensors can be removed far enough to shine a small light or use a borescope to view the reluctor teeth through the sensor bore. On some transmissions, reluctor damage means internal teardown.

Common Diagnostic Mistakes

• Confusing the OSS with the vehicle speed sensor (VSS). Some vehicles have both. The OSS is a transmission sensor that feeds the TCM. The VSS may be a separate sensor on the transfer case or transmission that feeds the PCM or instrument cluster. Replacing the wrong one does nothing.
• Not checking the air gap. On variable reluctance sensors, the distance between the sensor tip and the reluctor teeth matters. If a new sensor does not come with the right O-ring or spacer, the gap may be too large for a reliable signal.
• Ignoring ATF contamination. A leaking output shaft seal can push ATF into the sensor connector and up the harness. Cleaning the connector is not enough — if ATF is in the wiring, it will corrode from the inside out. Replace the affected harness section.
• Not checking both speed sensors. When you are in there testing the output speed sensor, test the input speed sensor too. They live in the same neighborhood and share similar failure modes. If one is failing, the other is probably not far behind.

Confirming the Repair

Clear all TCM and PCM codes. Road test through all gears at various speeds. Verify the speedometer is working. On the scan tool, confirm that output speed increases smoothly with vehicle speed and that the calculated gear ratios match the commanded gears. Shifts should be smooth and well-timed. If the vehicle was in limp mode, it should now shift through all gears normally. Two clean drive cycles confirms the fix.

P0720 is usually a straightforward sensor or wiring repair. Do not overthink it — but do test thoroughly before you replace. A $30 sensor fix is a whole lot better than a misdiagnosis. For related transmission diagnostics, check our P0700 guide.