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If you're having a hard time deciding whether you want a sports wagon (with respectable mileage) and the off-road capability of an SUV, Subaru may just have the answer: the 2007 Subaru Outback 2.5 XT Limited. The 2007 Subaru Outback 2.5XT has a base price of $30,995 ($35,649 as tested, and comes with Subaru's 5-year/60,000 mile powertrain warranty and an EPA estimate of 20 mpg city/26 mpg (automatic transmission) and 21 mpg city/27 mpg highway (manual transmission).


First Glance: Ready for the Outdoors

Over the last decade or so, my family and I have lived in Colorado and Connecticut, two states which are widely separated geographically but share a propensity for cold, wintry weather. People in those regions seem to have an affinity for Subarus and their grippy AWD systems that allow them to scramble over snow and slippery terrain. I owned an '02 Impreza WRX for a time myself, and can vouch for their all-weather prowess.

I recently spent a week with a 2007 Subaru Outback 2.5 XT Limited, and became convinced that this multi-purpose wagon/SUV does just about everything well, and is easily one of the best vehicles I've driven over the past year.

While the Subaru Legacy and Subaru Legacy Outback feature the same powertrain and AWD system options, the biggest difference is in the suspension setup and ground clearance. All Legacy Outback models feature a heavy-duty suspension and a few extra inches of ground clearance over their Legacy brethren -- the Legacy has a bit over 6", while the Outback has a tad over 8".

My test vehicle came loaded for bear: dual-zone climate control, power windows, mirrors and door locks, cruise control, remote keyless entry, XM radio, a GPS-based nav system and an aux-audio jack.

Extra-charge options on my tester included an "outdoor recreation group 1" option package [$525] (with roof-mounted bike carrier and metal cargo basket) and a mirror/compass and security system upgrade [$304]. The system looked sturdy enough to handle a few bikes and their related accouterments.

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In the Driver's Seat: Creature Comforts

Sliding behind the wheel, the first thing I noticed was the quality of the materials used in the passenger cabin. Subaru has always done well when it comes to reliability and resale value, but I felt that interior quality was never their strong suit. Subaru has made great strides in this department as of late, and its shows: this Outback utilized a pleasing combination of metallic trim with woodgrain accents, with an impressively good level of fit and finish. One caveat: the glove box seemed a bit wobbly during opening and closing.

The front seats were firm and comfortable: The driver gets spoiled with an 8-way power seat, while the front seat passenger has to make do with only a 4-way power seat. Both front seats feature manually-adjustable lumbar support and a heating option with four temperature settings.

My test vehicle was equipped with a 5-speed automatic transmission and Subaru's SI-Drive system. SI-Drive allows the driver to select from three different engine management and transmission control settings: "intelligent," "sport" and "sport-sharp." Intelligent mode returns the best fuel economy and smoothness, while the latter two deliver increasingly responsive engine performance and shifting at the cost of fuel economy. The difference between all three modes is noticeable, but I would have preferred a dash-mounted 3-way switch over the current SI-Drive dial beneath the shifter.

Other nice interior features of note included the intuitive touch-screen Nav system, a spill-retaining cargo tray and a convenient set of cargo tie-down hooks.

On the Road: Incognito Performance

The second row is a bit more cramped for adult passengers, but is comfortable for two average-sized adults over reasonable travel distances. The LATCH system seat anchors are clearly marked and easy to locate, making the attachment of a car seat for our toddler a 2-minute task. The second-row seats can also partially fold flat, allowing longer cargo items to be easily carried in the vehicle. My wife and I dropped the split fold-down rear seatback to make room for a newly purchased 60" long box of metal shelving, but I could imagine this feature being useful for carrying any number of long and narrow items, like skis, ladders and other objects.

The full-time AWD system helped ensure that we carried that shelving home across all manner of road surfaces with ease, from unpaved roads and rutted trails to rain-slicked highways. The 2.5 XT features a modestly tuned version of the same 2.5 liter turbocharged engine found in the Impreza WRX STI, a powerful mill that served up some impressive oomph when we needed to merge into traffic or pass a lumbering cement truck.

With SI-Drive turned to the sport sharp setting, I'd imagine that 0-60 times in the high 6 second range are possible. While you won't be outrunning Mustangs or Evos at the stoplight, the Outback 2.5 XT is surprisingly quick. The suspension did seem a bit soft and squishy on twistier bits of road, but the entire combination is impressive -- this vehicle may look like a mild-mannered wagon, but it serves up performance that some so-called sports sedans can't match.

Journey's End: Picking Nits

While the Outback 2.5 XT Limited is one impressive vehicle, I do have some gripes, which fall into two camps: somewhat cramped second-row seating and a gold-plated price tag.

The second row seats are perfect for children and even adults of average height. Sitting three adults abreast in that row is uncomfortable, especially if more than one is over 6 feet tall. Granted, Subaru would likely encourage people to move up to the larger Tribeca if they needed more interior room, but just an few extra inches of head and leg room in the second row would have made a huge difference.

The value dilemma is more problematic, as bang for the buck has historically been a Subaru hallmark: how many other vehicle makes offer such a great combination of resale value, AWD performance and reliability? Not many, but $35K for an AWD sports wagon seems a bit much, especially when you consider that it lands the Subaru within a reasonable distance of the Volvo V70R and the upcoming 2007 Audi Allroad Quattro. I applaud Subaru for refining and improving their vehicles over the years, but their recent move upmarket -- and their flirtation with the $40,000 mark -- is a bit troubling.

Seating gripes and value concerns aside, the 2007 Subaru Outback 2.5XT manages to feel just at home on twisty back roads as it does on mud-covered trails and smoothly paved highway. With a winning combination of cargo capacity, passenger comfort, all-weather/all-terrain capability and smile-inducing performance, the 2007 Outback 2.5XT stands at the top of its class.