Labor intensity, electronic complexity, hydraulic components and the cost of the mechanical parts are the reasons that a transmission rebuild is so expensive. Newer transmissions have more complex components than older models, so they are typically the most expensive to rebuild. Manual transmissions have fewer parts than automatics, so they are usually less expensive for repairs.
The transmission is a complicated component, with the most parts in the drive train. A large portion of the expense of a rebuild is the time-consuming labor required to disassemble, repair and reassemble the transmission.
Modern vehicles employ many electronic components to control the transmission's functions, such as computers, speed sensors, shift solenoids, range sensors, and many more that require expensive diagnostic equipment. Older units accomplish most, if not all, of the required functions mechanically.
Hydraulic components introduce another level of required expertise in fluid control and motion systems. The pressure systems are complex and must be rebuilt to rigid operational standards, or the transmission rebuild does not last.
The transmission looks like a solid unit when viewing the external casing. However, inside of the case is a very large number of parts, including gears, torque converters, clutch packs, the valve converter and the pump. Replacing all of the moving parts in a rebuild requires significant investment in metal.