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FJ Cruiser had a bad motor, replaced with good used one (or so the Salvage yard claimed). Replaced a few components during swap but no work to timing system or Harmonic balancer. Customer drove car less than 1,000 miles (around 600 i believe) and arrived with substantial oil leak. Found Crankshaft seal (Front) leaking. Remove harmonic balancer, found balancer broken at key slot (blown out).
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And here is picture of Key wedged in crankshaft and damage to crankshaft

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I am trying to solve the riddle on how this happened and then figure out if there is confident way of repair rather than replace Crankshaft? The Engine came with no warranty. Whats your guys thoughts? Thank in advance
 

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HB loose on the crank then when load applied failure.

Cracked HB hub that fits onto crank before load was applied and then when loaded complete failure.

I’m not sure of the spec of the interference fit or if the crank and hub are tapered but it can be damaged during installation causing the hub on the HB to crack, then fail.

Couple of guesses
A good machine shop could fix your key way on the crank If the crank is worth saving.
 

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That's what happens when the balancer bolt is not torqued to the proper value, loosens, and then the balancer hub rocks back and forth against the key. Eventually, the crank, the key, and the HB hub are destroyed. The HB bolt tightening torque is 185 ft-lbs, and that's not easy to apply if you don't have the special tool to hold the crank. Some 'mechanics' just use a rattle gun and have no idea what the actual fastener torque is, and hope it holds.

Like rod bolts, head bolts, main bearing cap bolts and flywheel>crank bolts, the use of an accurate torque wrench for the HB bolt is MANDATORY.

The crank is going to have to be pulled, regardless of what repair you choose.

The damaged keyway could (theoretically) be TIG welded, a new keyway machined, and then OD ground. However, done correctly, this would likely cost more than the price of a new crank. And, there is always the chance that a fatigue crack has been initiated down at the root of the keyway, and will eventually crack out a large 'D' shaped piece of metal from the side of the keyway, totally destroying the crank.

Another option might be to machine a new keyway in the crank 180 degrees from the original keyway, and install the HB in this position. This would only work if the HB was perfectly symmetrical, played no role in dynamic balancing of the engine, and functioned only as a pure harmonic vibration damper.

You'll find other more medieval-type repairs on the web using epoxy, dowel pins, or even just welding the HB onto the crank ...

By far the best solution is to get a new or reground crank, carefully measure the journals, replace rod and main bearings, plasti-gauging everything to confirm clearances, and then button everything up with a new oil pump.

Google 'damaged crankshaft keyway' and you'll find scores of images of severely damaged cranks.
 
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