I would start with finding the leak. Top off the cooling system and apply some pressure to it.

Water pump impeller is broken, replace water pump and timing belt kit..

http://www.youtube.com/watch?v=WJlS7MvfRXo&feature=plcp

Thomas

2.0L timing belt removal video:

http://www.youtube.com/watch?v=4N3QpRgvYsQ&feature=plcp

Thomas

I guess your crystal ball sees things that mine doesn't

I know VW & Audi... that's why I only post in the VW & Audi section.

Thomas

Quick way to confirm water pump flow or lack of flow:

http://www.youtube.com/watch?v=thcwatH_BpI

This is me being helpful... not advertising my youtube channel.

Thomas

Thanks everybody for your responses. Thomas, i tried the water pump test in your video and i got no flow until i hit the accelerator. That seems to be the problem.

Hi, have you had a chance to see where the leak is? Passenger side of engine would be the water pump... leak
would be dripping from under the crankshaft pulley. It is a 2 liter engine, yes?

If the leak is behind the engine (towards the firewall), then the leak is either a heater core coolant hose flange
or the heater core itself (leaking out the A/C drain).

Thomas

Good morning Thomas. After i replaced the thermostat, the only leak i see is on the passenger side but further back, almost like the fluid is traveling along a line then dripping. As I stated previously, I tried the water pump test from your video and that might be the problem. The car runs fine, but no heat from the vent and when I took it around the block last night, the engine temp went up quickly. The hose that leads to the thermostat is warm; could it be something else maybe?
I understand that replacing the water pump can be a bit of a job...

No heat from vents is another verification that the pump is not circulating.

The upper hose always gets hot... the lower one will stay cool(er) when the pump does not circulate.

Thomas

Good to know