Actually it raises the shift points for the gear changes while towing. Allowing you to stay in a lower gear longer. For example, if your normal shift point is 3500 RPM, with tow mode on your gear shift will occur at 5500 RPM. This reduces the amount of times your transmission will shift, especially going uphill, and reducing wear and tear on tranny.
Nissan gave you the button because 8 out of 10 truck owners havee towing hitches on their truck be it factory installed or aftermarket. I believe GMC does the same thing.
It also gives you crappy gas mileage. I have a toy hauler and with the tow mode on I might get 150 miles to a full tank. With it off I almost can get 200. Your better off just manually switching gears when going up hills.
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