The present invention provides a low cost pre-alloyed iron based powder which has high compressibility, capable of rendering a compacted and sintered component high green density, (GD), and high sintered density, (SD). Also, a method or process for producing components, especially gears, including compaction of powder mixture containing the pre-alloyed iron-based powder, sintering of the compacted component, Low Pressure carburizing, (LPC), High Pressure Gas Quenching, (HPGQ), and tempering, is provided. In one embodiment, the process includes high temperature sintering. Other aspects of the present invention include a powder mixture containing the pre-alloyed iron based powder and components produced by the new process from the powder mixture. Such carburized components exhibit a hard surface combined with a softer and tougher core, necessary properties for e.g. automotive gears subjected to harsh environment.