When your Volvo S40 overheats the culprit is usually the engine's thermostat. However, if you have replaced the thermostat and the "check engine" light is still on, the issue could be the coolant temperature sensor. The coolant temperature sensor, or CTS, measures the temperature of the engine's coolant and sends a signal to the computer. If the CTS malfunctions, the computer turns on the "Check Engine" light because it thinks the engine is overheating.
Open the engine bonnet by pulling the bonnet release latch located on the lower kick panel on the driver's side of the Volvo S40. Lift the bonnet up and prop it on the bonnet prop.
Locate the steering shaft that extends from the firewall to lower suspension located inside the engine compartment, by the front right wheel. Halfway down the shaft, you will locate the power steering pump. The pump is a black container that bolts to the driver's side of the engine block. On the top, you will find a cap that says "Power Steering Fluid."
Look to the left of the cap. Bolted to the power steering pump is the thermostat temperature sensor. The sensor has a black round cap and a black wire extending out of the top.