DIAGNOSIS Grime, dust, or dried-up factory grease has jammed the detent mechanism under the collar. It's a physical obstruction.
FIX Apply penetrating oil (like WD-40) around the seam where the collar meets the tool body. Let it sit for 10 minutes. Then, try to work the collar back and forth while pulling it slightly away from the body. Wipe away all the dissolved gunk that seeps out.
IF THAT DIDN'T WORK The internal detent spring or ball may be corroded or broken. This requires disassembly. The collar is not designed for user removal without taking the front housing off.
HEADS UP Don't force it with pliers—you'll break the plastic collar. If the oil trick doesn't free it, it's a shop repair. You can still use it in whatever mode it's stuck in until then.