Liane Yvkoff

With the Outback growing up to become more of a crossover and less of a wagon, the 2012 Subaru Impreza is angling to fill its bigger sibling's shoes with a roomier and more fuel-efficient small vehicle to compete in the growing compact car segment.

Subaru

Bigger than the subcompacts millennials may have bought during or just out of school, and more refined than their parents' hand-me-downs, Subaru wants the Impreza to be a car buyers' first real car.

And what constitutes a "real car?" Something that's nice enough to impress a boss or date, but still functional enough to cater to the transient and active lifestyle that is much of a person's 20s. A vehicle that offers hints of the bells and whistles seen in upmarket luxury cars, but steeped in enough utility to take a solid beating from weekend warriors.

Basically, it's as close to a midsize vehicle as you can get without coming standard equipped with car seats and conversation mirrors. Available as a four-door sedan or a five-door hatchback, the Impreza is like the buyers it targets: semi-grown-up. To make a point at a press event, Subaru demonstrated that it could pack a ~200 sq. ft. studio apartment full of Ikea furniture into a five-door model, complete with faux art wall hangings, iPod docking station, and requisite fuzzy slippers.

Bigger on the inside, not on the outside

Subaru

To make the compact car seem bigger, Subaru increased the vehicle's wheelbase by an inch while shortening the body overhang to retain the same footprint as the previous model. The sedan is still 180.3 inches and the five-door model is still 173.8 inches, but the subtle changes opened up 2.3 cubic feet of interior space in the sedan, and 2.9 in the five-door.

The extended wheelbase coupled with scallop-backed front seats added almost 2 inches of legroom in the second row. And now there's also a bit more cargo capacity in the sedan and hatchback.

To put it in perspective, an extra cubic foot of cargo capacity in the sedan means the trunk can now hold four sets of golf clubs, compared to three in the old model. And at 22.5 cu. ft., the cargo space of the five-door model is 3.5 cu. ft. larger than the previous model year, which means that with the rear seats folded flat, the 2012 Impreza can hold a mountain bike with the front wheel still attached.

Most fuel-efficient AWD car

But the star feature of the 2012 Subaru Impreza is the fuel economy, which is expected to be rated at 27 mpg in the city and 36 on the highway--a 30 percent increase over the previous model. As of this posting, the 2012 Impreza is the most fuel-efficient gasoline-powered all-wheel-drive passenger car in America, according to Subaru. Its continuously variable transmission (CVT) may help it achieve better fuel economy than a manual, although official numbers have yet to be released.

That leap in fuel efficiency is due in no small part to the new, 2-liter boxer-style engine, which provides a 10 percent fuel economy gain compared to the outgoing 2.5-liter engine. As with any give, there will be a little take: you have only 148 horsepower to play with in the 2012 Impreza, compared to 170 hp found in the previous model year.

The engine can be paired with either the standard five-speed manual or the new CVT option. New electric power steering also contributes to a 2 percent efficiency gain.

Still a driver's car

With a dedicated tuner and driving enthusiast following, Subaru expects a 30 percent take rate with the manual transmission. But the new CVT offers a comparable shifting experience that won't nauseate manual die-hards. The virtual gear ratios of this CVT have been tuned to feel more like a manual transmission and offer increased power out of the gate, according to Subaru, than with the CVT offered on the Outback. And on that claim, the 2012 Impreza actually delivers.

Liane Yvkoff

Even when not using the paddle shifters to manually choose the six virtual gear points, the revolutions rise and fall, rather that delivering a boring, continuous wind up to cruising speed. Paired with the 148-hp 2-liter engine, the car won't knock your socks off, but it is still fun. The CVT also enables a new hill assist feature.

Subaru improved the Impreza's double-wishbone rear suspension with stronger components for better stability, handling, and comfort. The Premium model also adds a rear-suspension stabilizer bar for better driving performance. And unlike most compact competitors, all-wheel drive is standard on all models. But that's an advantage that's definitely felt in the starting price of $17,495.

Interior refinement

No one has ever accused Subaru of being luxurious, and as a first grown-up car, the Impreza doesn't try to break that barrier. But the auto manufacturer is catching on to the sporty refinement that buyers are attracted to and expect, even in the compact car segment.

To give the Impreza an upmarket feel, Subaru replaced much of the hard plastic interior with soft touch points on the dashboard, door trim, and center console armrest. That, coupled with better audio options, shows that Subaru is racing to catch up to competitors that started paying closer attention to infotainment a lot earlier.

The Impreza is available in base, Premium, Sport Premium, Limited, and Sport Limited trims. With the 2.0i base model, you basically get a car with an AM/FM radio. In fact, the only option in the base model is the CVT. The Premium trim upgrades the wheels from 15-inch steelies to 16-inch alloys, and adds an audio system with a CD player, six speakers, USB port for iPod integration, auxiliary input for MP3 players, Bluetooth connectivity, and audio streaming, along with a few interior and exterior changes.

The Limited comes with the CVT, 17-inch wheels, fog lights, and the cold weather package, to name a few advantages. It also adds a 4.3-inch audio display with enhanced graphics for HD radio and iPod integration. With an iPod connected, you'll also be able to tag songs that you can purchase on iTunes the next time you sync your mobile device.

On both the Premium and Limited models, you can spring for the optional 6.1-inch touch-screen display with navigation system. The navigation system has easy-to-read graphics with a fairly intuitive interface, and the upgraded head unit adds available XM Satellite Radio and XM NavTraffic, and is equipped with about 50 voice control commands to facilitate some amount of hands-free infotainment control.

Liane Yvkoff

The GPS system doesn't read addresses from your address book, but to help make navigating easier, Subaru expanded the number of points of interest that you can save to the database to around 500. To help drivers save gas, an eco-route mode in the navigation system shows the most fuel-efficient way to get to a destination.

But the selling point on the navigation system isn't its capabilities, it's the price point: on the 2012 Impreza, the technology costs $1,000 less than the previous model years, making it a more affordable option to buyers.

A lot of bang for your buck

Value is sort of the overall theme of the 2012 Impreza, and it will give its competitors, the Mazda3 and Jetta, a run for their money. You get the fuel economy of a compact car with the cargo capacity and standard AWD you typically find in a larger vehicle class. Pricing for the 2012 Subaru will start at $17,495 before the $795 destination fee, and top out around $22,095 for the top of the line Sport Limited five-door hatchback. The 2012 Impreza will be available starting in November.