when "fail-safe" thermostats fail, they fail open, this can cause your heat to run luke warm, never getting very hot. If I were you I would replace the thermostat, flush the entire system (does your radiator feel hot all over or are there any cold spots that indicate a blockage?) and give it a shot.

I douche out my cooling systems with white vinnegar. This eats a lot of crap out of the system - even the good crap that stopping leaks, so be prepared!

Also - I don't know by which means the Volvo mixes in outside cold air to regulate temp, but you could have something as simple as some weather stripping failure to explain cold air mixing in with the heated air.

Good luck.

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