Originally Posted by Nikit
Thanks to all who have responded. All information was very helpful. I am going to purchase new transfer switch and cut off burnt wire and replace. Will let you know if this was successfuy
You could probably clean up the connection and re-torque as others have said, but replacing the component that was overheated is the safest way to go if you are concerned.
Gonna take a look at mine as I haven't been in there in a while.