I have a 2012 Chevy Cruze LT my temp gauge works while car is in park and produces heat however once I start to drive it drops to c and I lose heat?

Are the radiator and heater hoses hot when problem is ongoing. Can you compare actual engine temp vs the temp gage, when problem is ongoing? Do you live in an extremely cold region? Any applicable trouble codes? It appears your vehicle has two coolant temp sensors. At the moment, I don't know if the temp sensor/s has a problem? Does your thermostat have an electrical connector? Did you check that circuit? My info for your thermostat says 221 degrees F. That should be hot enough for your heater. Do you think you might have air in the cooling system?

I am going to try and answer your questions to the best of my ability. I did not notice if the hoses were hot so I'll have to check that. I live in New England so nothing out of the ordinary. There was a code ac off due to high engine temp (engine was not over heating and ac was not on when error code appeared) but that issue has been resolved. I replaced the engine coolant temp sensor (ACDelco 213-4688 GM Original Equipment Engine Coolant Temperature Sensor) Yes my thermostat does have an electrical component which is why I'm thinking maybe that went on the thermostat so I would need to replace the whole thermostat again because I don't show that it comes separately. On my dash it read 150 degrees F. I don't believe there is air in the cooling system.