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Q:

Engine gauge shows overheating on 1998 Ford Contour

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The temp. gauge slowly goes over to the red area but the fan does not come on until it's almost there. Changed that fan sensor, no change. It does not boil over? It acts like there's no flow through the engine? New thermostat, no change. No leaks. Is it possible for somethine inside the water pump to fail and cause the no water flow? The old days you could take off the radiator cap and see the return flow.
(1) Answer
The water pumps for the 2.0L 4 cylinder had a upgrade service program back in 1999 because the bearings could fail. You would notice a failure on that. I've seen some vehicles have a broken impellar on the water pump that can cause a flow issue, but they are few...and not necessarily on a Contour.

Do you notice one or two speeds to the cooling fan? There should be a "high" and "low" speed. It's possible the low speed is inoperative causing the issues you describe.