When the gear selector lever is moved to the Neutral (N) position (from the Reverse (R) position) the following changes occur to the transmissions hydraulic and electrical systems:

Manual Valve: Blocks line pressure from entering the R321 fluid circuit and opens the R321 and reverse fluid circuits to an exhaust port. As in Park, the manual valve also blocks line pressure from entering any other fluid circuits.

Mode Switch (Electrical): Signals the TCM that the selector lever and manual valve are in the Neutral (N) position.

Reverse Clutch Releases

Reverse Lockout Valve: With reverse fluid exhausted, spring force moves the valve out of the Reverse position. This opens the reverse clutch fluid circuit to an exhaust port through the valve.

Reverse Clutch Piston: Reverse clutch fluid exhausts from the piston, thereby releasing the reverse clutch plates and shifting the transmission into Neutral.

Torque Converter Clutch Solenoid: Solenoid feed fluid exhausts from the solenoid. If Reverse Lockout is in effect when Neutral is selected, the TCM will de-energize the solenoid, exhaust solenoid signal fluid and release the converter clutch.

Reverse Shuttle Valve: Solenoid feed fluid exhausts past the checkball and through the reverse fluid circuit.

Boost Valve: Reverse fluid exhausts from the boost valve, thereby returning line pressure to the normal operating range as during Park and Drive ranges.

Shift Solenoids: The 1-2/3-4 shift solenoid remains OFF and the 2-3 shift solenoid remains ON. Also, with the manual valve continuing to block fluid from feeding the solenoids, the solenoids remain ineffective.

Neutral - Engine Running