02 Silverado 2500HD 6.0- Besides a small exhaust leak where the manifold bolts to the block ( I am getting that fixed), truck runs fine.

Yesterday when I was pulling my boat (for the first time) going uphill when it drop a gear to get more power to make the hill, I noticed greyish/white smoke coming from the exhaust (and some in the cab of truck). I also could smell a hint of trans fluid when it happened. It only happened when going uphill.

Do not see any leaks.
The coolant level looks good and no change in color.
Trans fluid level good, a tad bit on the high side.

I will mention, When I added trans fluid, it shifts real good until it gets warm, then it shifts a bit harder. But when checking the fluids, they all are where they need to be.

I also talked to a mechanic buddy of mine and he says it could be the transfer case seal. I checked the transfer case fill plug and nothing came out but there is fluid in there.

Any clue what I should check? I read it could be because the truck is burning oil instead of fuel, but I have no idea where to start diagnosing it. Any help would be greatly appreciated.

 

if its white with a blueish hint, its engine oil, white is coolant, black is fuel.

one possibility is its burning oil. check for blow by out the oil cap. do a compression test..wet and dry. is its a high miler