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there are a few big hills around Blacksburg where you can shift into N and just coast down them. I used to do this from time to time in my SHO. it seems to confuse the computer however. normally at idle the car runs around 700rpm in P or N, but when the speedo shows 70mph, and the car is not in gear the tach bounces around anywhere from 700 to 1500, it doesn't seem to be able to make sense of the low rpm and the high speed, almost as if the computer thinks the car should be in gear and can't resolve what gear can possibly keep the car moving that fast at such a low speed. for that car normally it would be at 2500 or so at 70. the car doesn't seem to know its in N, another quirk I found while coasting down those hills is that if you shift into N and your speed drops below where the cruise is set, it will rev the engine up in vein until you tap the brakes or hit the cancel button. it has no idea that opening the throttle will not increase speed, obviously it has no idea it isn't in gear.
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I shift mine in traffic frequently. I also put it in neutral at most lights, train crossings, etc when I have to stop for more than just a few seconds. My car is heavily modified with lots of low end torque. I don't have a stall converter and quite honestly, it takes quite a bit of pedal pressure to hold it in place, so it's easier to pop it into N.
If you shift into neutral while you are rolling up to a stop, all your stopping power comes from the brakes, ergo, increased brake wear. By leaving it in gear, foot off the gas until you stop, the motor helps to slow/stop you resulting in less brake wear over time. After you are stopped, shifting into neutral shouldn't hurt anything unless a.) you hit the gas when the light turns green while still in neutral and the guy behind you plays bumper tag, or b.) you accidently shift to reverse and hit the gas. (I've seen that happen a few times).
If neutral shift done routinely, I imagine over time there would be excess wear on your shifter and linkage, etc., then again, maybe not.
Cheers
AT cars always have power being applied to the wheels, that is why an AT equipped car will "creep" at low speed when in gear even though the accelerator is not being pushed. One trick for stopping on an surface totally covered with ice is to ease the car into neutral (NOT hitting reverse) when coming to a stop sign. Try it, you will be amazed (again on ice) at how much more quickly the car stops. It's essentially like pushing in the clutch in a manual car. So there will likely be less brake wear with the AT car's brakes during those times the car is in neutral coming to a stop. But so little is saved, that is not a good rationale for the practice the OP mentioned.
I would be concerned about excessive wear to U joints and axles caused by increased dropping into gear. When an AT car is moved into gear, we all know the driveline takes up slack. In a manual car, with a good driver, that take up is smooth and phased as the clutch engages. With an AT, it's a more sudden take up. Repeated cycles = more wear, to my mind.