Here's my best explanation of why headers fail with header wrap (I'm a
metallurgist by day). With plain carbon steels, the material itself can
actually suffer from thermal fatigue, temper embrittlement, and accellerated
corrosion. Thermal fatigue is just the process of cyclic heating and
cooling. This is common to all exhaust systems, but the problem is
exaggerated by the thermal wrap, because the temperature which the header
material is subjected to is higher than it would be without the header wrap.
The heat which is normally dissipated throughout the engine compartment is
held in the headers, causing them to be heated to temperatures where
corrosion is accellerated, and thermal fatigue is greater due to larger
gradients in the heating/cooling cycle. Temper embrittlement is caused by
holding carbon steels in temperature ranges which can be sufficent to cause a
phase change in the steel. This is often called re-crystallization, and
causes normally ductile steels to become brittle, and fail in a brittle
manner.
The end result is a combination of these phenomena, which results in
brittle, cracked headers with high levels of corrosion. In short, the header
wrap will keep the heat out of the engine compartment, but at the cost of
shortened header life.
SteveM.
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