I have a '99 V70 XC. About three weeks ago, my low coolant light came on. Prior to that I had never even seen the coolant reservoir below the full line. The reservoir was actually empty, so I filled it up. (I never did see any leaking coolant on the garage floor). Since then, it seems like the heat coming into the cabin is warm, but not blistering hot and the cabin never gets overly hot. On Christmas morning I was driving from Indianapolis to Tulsa. When I left, it was about 15 degrees outside. I don't think the cabin temperature rose above 65 regardless of the fan speed until the outside temp got over 25 degrees (after the sun came up). The water temp gauge stayed down at the bottom of the scale unless the transmission downshifted to maintain speed up a hill. Then it would rapidly swing up to it's usual roughly horizontal position. As soon as the transmissionupshifted again, the temp gauge dropped back down to the botom of the scale again.

The reservoir is still full, but is there air in the cooling system that is keeping full flow of coolant from going to the heater core? If so, what is the best way to bleed the air out? What else might it be?

 

I would bet the thermostat is bad.