All new cars use some sort of neutral safety switch to prevent the car from starting while in gear. The neutral safety switch on most vehicles attaches either to the shift mechanism inside the transmission or to the shifter mechanism itself. Failure can easily immobilise the vehicle or can cause it to start in gear.
Failure to Start
While specific designs vary, the neutral safety switch usually acts as an interrupter between the starter relay and the starter, or the key and the starter relay. During normal operation, the switch's internal circuit will only close while in neutral or park. In no other position will power make it from the ignition key to the relay or the relay to the starter. If your vehicle's starter does not engage in any way when you turn the key in park or neutral, the neutral safety switch may be at fault.
Check Engine Light and Code
The neutral safety switch is an important component in preventing injury and death, so it may be part of your vehicle's diagnostic circuit. Your manufacturer may have incorporated a feedback circuit into your starting system or transmission, allowing the computer to diagnose the problem and notify you via a check engine light. If you suspect a faulty neutral safety switch and your check engine light illuminates, have a technician read the codes with a scanner. Many chain auto parts stores will pull and clear your vehicle's codes for free, but you'll have to get it there first.
Starts in Gear
Modern neutral safety switches are a default-off design, meaning that if the switch fails it will immobilise the vehicle instead of allowing it to start in gear. Still, it's not impossible for contacts to cross over due to moisture in the switch, metallic debris, physical damage, metal shavings from wear or any number of other faults. If this happens, the power side of the switch terminal will short against the housing or power-out terminal to the starter, allowing the vehicle to start in gear. Older neutral safety switches may not incorporate a default-off design, so failure can manifest as a constant-on and starting in gear.
Wiggle the Shifter
One way to diagnose a bad neutral safety switch is to place the shifter into park or neutral, then try to start the engine while gently wiggling the shifter so that it almost goes out of gear. This will engage a different part of the contact inside your switch, allowing power to go through to the starter relay. If your vehicle only starts while wiggling the shifter, then you need to replace the neutral safety switch.