In the powder metal industry, machining of components is becoming more prevalent as tolerances and features become more demanding. The powder manufacturing processes provide easy and flexible capability in formulating alloying and additives to achieve desired properties including machinability. Manganese sulfide (MnS) has long been the dominant machinability enhancing additive due to its ability to provide improvement in turning and drilling of PM materials, especially in machining of iron-coppercarbon materials. The development of the SM3 machining additive overcame the negative effects of MnS such as stains and corrosion while providing superior performance of turning operations but its performance in drilling of the iron-copper-carbon materials is not as good as MnS. A newly developed machinability enhancing additive aiming for improved performance in both drilling and turning has been evaluated and compared to the commercial additives in machining of iron-copper-carbon materials based on laboratory testing and full scale production trials. Machinability data, mechanical properties and corrosion testing results are presented to demonstrate the effectiveness of the new machining additive named SM4 as a potential machinability improvement solution for replacing MnS without corrosion and stain concerns.