Aloha All,
this is my first Benz, just paid it off last week ,
Symptoms,
starts fine (purrs) warms up i can get about a mile normally then it down shifts to second and Im held at 25mph and 2800 rpm. I cant quite tell if its moving from 2nd to first or vice versa.
no lights, no over temps, all fluids full, no blown fuses
Maybe a clue, the coolant temp gauge seems erratic going from cold to red line then level 80-95 with intermittent pulses. I cleaned a little corrosion off both the fill level sensor and an unknown sensor below the reservoir.
Is it in limp / tranny gone? vac. system full of holes? get home mode where do i start?
What about reseting the computer?

I re-cleaned the sensor contacts and added a couple drops of a high-end gun-oil. Im still a little nervous to take it on the highway but i was able to get around town this afternoon with out getting stuck in second gear.
All this with a knife some research and a couple drops of oil.

I don't believe the temp indicator is related to your transmission issue. I think the temp indicator has its own sensor and there is another sensor for sending info to the computer.

But the computer does nothing to control the trans in that car. The trans is supposed to delay the first 2-3 shift of the day to about 2500RPM in an effort to speed the warming of the cat. Assuming you have an American-market car with a cat.

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2012 E350
2006 Callaway SC560

If it's shifting fine when cold, going into 4th gear, then dropping out of 3rd and 4th when warm, you've got internal leakage inside the tranny, and it's time for an overhaul.

Jim

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14 E250 BlueTEC black. 45k miles
95 E320 Cabriolet Emerald green 66k miles
94 E320 Cabriolet Emerald green 152k miles
85 300TD 4 spd man, euro bumpers and lights, 15" Pentas dark blue 274k miles