[DieselDrax]

Sorry to hear of your issues. Chances are you have a hole in one of your pistons, possibly due to injector failure (the knocking sound could be a sticking or leaking injector). Hard to say for sure without both testing the injectors and inspecting the pistons. One thing is for certain, do not pay $19k for a new engine. That's highway robbery and likely unnecessary, but again impossible to say without tearing into the engine. Most common issue is a cracked/fractured piston and as long as the cylinder wall(s) aren't scored or too damaged then you can get away with replacing the necessary parts for the rotating assembly. Much less expensive than a whole engine.

If you didn't want to go that route and don't want to pay the dealer $19k, find a local shop you trust and have them install a reman engine like Duramax Diesel Wholesale - a Division of US Engine Production (duramax66.com) and including labor I'd expect to be out around $10k, which is much better than $19k.

Dealers aren't in the business of diagnosing and fixing what's broken, they're in the business of highest cost with least effort, in this case replace the engine without actually knowing what failed and if it can be repaired instead of replaced. This is why I would recommend finding a reputable independent shop in your area.

If it were me, I would have the shop pull the injectors (will need to raise the cab slightly to have clearance for the #4 injector to be removed), ship them out to be tested, and drop a borescope into each cylinder to check for a cracked/holed piston. Likely to be cylinder #3 or #4 but all should be checked. At that point it should be possible to get an idea if your engine can be saved or if the block/cylinders are too damaged. At that point you'd have a better idea of what needs to be done. Best case is the engine can be repaired and you'd be out a lot less than $19k. Worst case is you need a new long block, injectors, injector hard lines, and then move everything else from the dead engine to the new engine.

You might also try talking to your insurance agent about this, apparently some folks have been able to get insurance to cover replacing the engine due to the cost involved. This would be more of a hail Mary but worth a shot anyway.

Hope this helps!

 

[DieselDrax]

You might want to consider changing the fuel filter more often. 60k on a 20k maintenance item may have lead to compromising an injector.

Nope, the fuel filters don't have a bypass mode. There is no risk running them to their indicated interval via the DIC, there's actually a bigger risk with more frequent changes than necessary as aerated fuel will cause a spike in wear until the air is completely purged.