Well, Edmunds and Motor Trend have leaked official photos of the third generation Subaru Impreza. The car will be officially unveiled on Thursday April 5th at the New York International Auto Show. The current generation is one of my favorite cars on the road thanks to its unusual styling and rally-inspired full-time all-wheel-drive system (on manual and turbo models only). But the automatic transmission is dated and sluggish, and the interior, while sports car material, lags-behind the cleaner, contemporary cockpit of the Legacy and Outback siblings. A serious redesign was needed. And the initial offering coming this fall is a mixed bag.

Still built in Japan, the Impreza will offer solid mechanics. The suspension has been upgraded. The engine is the same, reliable 2.5-liter flat-4 that drives the Forester and most Legacy and Outback models. With the optional turbocharger, it generates 225HP. However, those who cannot drive stick, including myself, will have to wait for an upgraded gearbox. The dated 4-speed transmission will be carried over to 2008, and it is not practical for use with the turbocharger. So for full-time AWD, you must order the manual tranny.

Subaru's strategy is to dramatically increase sales of the most affordable and practical model, the 2.5i automatic. It will compete against the Volkswagen Rabbit, Golf, Mazda 3, Honda Civic, Mitsubishi Lancer, and Toyota Matrix, which all start under $18,000. The high beltline and increased headroom should make it more appealing, especially for those who are turned-off by a low-riding sports car. The 2.5i Impreza will use the current part-time AWD system, which is shared with the base Forester, Legacy, and Outback. With the exception of the rally-style underbody spoiler in the rear, the exterior styling is more conservative this time around. The compact, chrome grill and low-profile headlights remind me of the 5th generation Toyota Camry, Mazda 3, or even the Nissan Murano crossover.

Subaru enthusiasts are all asking the same thing: "Chrome?" Even the Camry Sports Edition trades-in its chrome grille for one in matte black. So Subaru still does not have a unified grille or face design across its 5-vehicle range. Subaru calls this grille the "mustache" grille, and it is is used by the Outback and Legacy in Europe, as well as the 2008 Tribeca and Impreza. But the Forester and North American Legacy and Outback get something else entirely. On the positive side, the famed Stars of Pleiades emblem on the new Impreza will be extra-large compared to all other Subies. It is no longer the badge for a cheap, inferior car.

The interior is the most significant improvement, and it is a welcome change. It features bigger guages, slightly fewer seams, an available navigation system, and a sculpted dashboard similar to Subaru's flagship, the B9 Tribeca.

So this first-year Impreza is going to try to appeal to everyone who is open to driving a hatchback. No word if the Outback Sport (based on the Impreza) will still be offered in 2008. My guess is that it will be dropped and customers will be encouraged to opt for the Forester if they want a compact car with raised suspension.