I just bought this '98 Jag XJ8 with about 86,000 miles on it. After about 300 miles of the initial drive, the "Coolant Level Low" indicator came on. I checked the actual coolant level, and it was fine, but I topped it off anyways.
After about 25 miles of driving from that point, the indicator came on again. I checked the actual coolant level again and it was still full. The indicator comes on usually after about 5 miles of driving and continues to stay. There is no leakage, nor are there any cracks that I am aware of. The car does not overheat, nor is there a burning smell of any kind. I do know, however, that the car was not driven much at all for about 6 months before my purchasing the Jag from the previous owner; consequently, a mechanic thinks that the indicator is coming on because of "air bubbles" trapped in the system.
He told me to drive the car for about a week or so to "flush out the air from the system" (I don't know the mechanic well). I did put in a coolant system sealer just in case (but to no avail). Please provide your professional opinion, which I need and shall appreciate.
The coolant level sensor, which triggers the coolant level low indicator, is located at the bottom of the coolant reservoir. It's a simple sensor with a float attached. Air would activate the sensor only if enough was purged from the coolant system to drop the coolant level in the reservoir below a certain point. So air is not the problem if the reservoir remains full.
Next time the coolant level low indicator comes on, disconnect the sensor. If the light goes off, the problem is the sensor, or possible contaminants or an object within the reservoir obstructing the sensor's operation. There have been cases where the float sticks and requires replacement of the entire reservoir.
If the indicator remains on, there's an electrical fault involving another part of the indicator circuit. We pulled up Jaguar's technical service bulletin number 413-03 with the ALLDATA Information system. It pertains to a condition producing erroneous warning messages at the instrument panel on certain '98 XJ8s, due to a poor connection at the instrument cluster. This may be helpful if the coolant level sensor tests OK.