The PSD relies upon the information from the wheel sensors (rotating simultaneously) and the lateral sensor. This is an acceleration sensor that informs the PSD of a sharp turn. At high speeds the Frerrara effect causes the car to brake loose at the rear (oversteer) and become uncontrollable.

The PSD responds to this and manages the power on the rear wheels to accommodate and prevent a rear break out.

It is located under the driver seat (LHD).

I just fixed a problem with my PSD, well with the help of an electronics expert. I had a faulty acceleration sensor (no resistance between the 5V supply and signal output on the sensor, good one had about 800ohms) but was still getting diff off with the good sensor. Tried a good ECU and worked so knew where the problem was.
Turned out the ECU was not sending 5V to the sensor and discovered a fuse in the ECU which was replaced and now works. That saved me 1500 for a new ECU from Porsche or 300 used.
Never had working PSD before, it is amazing.

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I visited Bob (928 at last) this morning and he was kind enough to run the diagnostics with Theo's software. Two errors showed - one for the yaw sensor and one for the transverse lock. Bob had the same errors with his '90 and resolved them by cleaning the sensor.

So I took mine apart. The copper-coloured swinging pendulum was seized so that it could not easily move from side to side - it stayed wherever I pushed it. I sprayed copious amounts of contact cleaner in, but this only partially cleared the pendulum. I found that the core of the magnet above which it floats was corroded - flakes and filings remain stuck to it since it is magnetic. I had to use a sliver of business card to slide under the pendulum to work the debris out, then scrape it off with a screwdriver. Once I had finished the pendulum moved freely.

Placing the sensor on either side (1g lateral) showed that the pendulum would move to that side, but not completely. Shaking the sensor in either direction (>1g) produced a click as the pendulum touched the side - btw, this would be a quick diagnostic test without even having to open the sensor.

Here is a pic of the cleaning process showing some of the debris removed and the card inserted: