Sounds like another Governor Pressure Transducer. The 2000 and up versions are different than the 1999 and ealier ones. The PCM needs to get an increasing pressure reading from it in order to raise the Governor pressure to allow upshifts.

If the PCM thinks the pressures are higher than expected, then the limp mode(3rd gear starts) are the result.

If your truck hunts between 1-2 or 2-3, this could also be a trait of a fluctuating pressure signal from the transducer. Especially under very light throttle situations(parking lots or heavy traffic)

The best way to troubleshoot the Governor transducer/solenoid is to hook a pressure gauge to the governor test port, and watch it.

 

thanks for the tid bit Fred... on another subject however, would you know what causes the diesel to hunt when it first stats cold..... I can watch RPM's bounce between normal idle with the engine giving a sound "rumpff rumpff rumpfff (sorry no better way to describe it) look forward to your reply.....

 

I am crossing my fingers to not have to do that dodge529. After we adjusted the bands it still didn't work quite right. We then went back in and replaced the sensor. Wish we had known about that at the time but we were only out an extra gasket and some atf fluid. It is running great now. "knock on wood"

 

Same here, cost me over $1200 for a new valve body installed at the dealer, sounds like I got a royal rip off. Mine had 41K at the time it had the SAME EXACT SYMPTOMS as you.
A Special Thank's Newark Dodge, Newark, DE!!!!