A vehicle drive unit assembly includes an axle extending between a pair of wheels, a braking system for slowing and stopping the vehicle, and a retarding system located on the axle for assisting the braking system. The axle has a housing and an axle shaft that receives input from an engine and driveshaft to drive the wheels. The braking system includes a brake member supported on each of the wheels and an actuator for selectively moving the brake members between an unactuated position and an actuated position. The braking system produces a braking force to slow or stop the rotation of the wheels when the brake is in the actuated position. The retarding system includes a plurality of magnets supported for rotation with the axle shaft and an inductor held fixed to the axle housing. The retarding system produces a retarding force as the magnets rotate with respect to the inductor to slow the rotation of the wheels when the actuator moves the brake members to the actuated position. Thus, the retarding system assists the braking system to slow and stop the vehicle.