The overflow is pressurized, so age and brittleness makes it crack and leak. When was it last replaced if ever? Mine cracked from heat and brittleness, usually the red bobber snaps off as a sign that the rest of the tank is going too.

There's lots of plastic used for the hot, pressurized cooling system. It's not a question of if they will fail, but when. I replaced my entire cooling system in my car when I saw two places where the plastic cracked... I suggest you do as well if you plan to keep and drive the car long term.

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Mike - Greater Seattle, WA, USA
2002 E53 X5 4.4i Sport Pkg Black (daily & tow vehicle)
2003 E53 X5 4.6is Estoril Blue (to replace 4.4i soon)
2002 E53 X5 4.4i Sport Pkg Silver [sold]
2001 E46 325Ci Hardtop 5MT Topaz Blue [sold]
+ Toyota track/autox/rally cars: MR2 (x2), Celica AllTrac Turbo (x3)