The XT range was replaced by the Subaru SVX in 1992.
By the time the XT was launched, Subaru had already produced vehicles with very different styling compared to other vehicles of the time period. The XT, first introduced in February 1985 in the United States (June 1985 in Japan), was a wedged-shaped departure from the 1970s-influenced curves of the previous models, aimed directly at the styles emerging in the 1980s. When introduced, the New York Times called it "the ultimate in jazzy design", in contrast to Subaru's older "cheap and ugly" offerings.
The extreme wedge body shape was possible due to the engine's flat horizontally opposed cylinder layout shared by all Subarus in 1985. Extensive wind tunnel testing was used to lower wind resistance and even "aircraft type" door handles were used that were totally flush with the outside of the door. You had to push a hinged panel out of the release mechanism's opening to open the door. Rubber spoilers before each wheel well opening doubled as "mud guards" but really acted to direct airflow smoothly past the tires and wheels. The result was one of the most aerodynamic production car of its time with a coefficient of drag or Cd. of 0.29, improved fuel economy, and a quieter ride due to reduced amounts of wind noise.
The inside of the car had many aircraft-like features such as pod mounted lighting, climate control and wiper controls. The standard tilting-telescoping steering moved the instrument panel to keep it lined up with the steering column when tilting. The shifter was joystick-shaped and had a thumb trigger interlock and "on-demand" four-wheel drive button. Turbo models featured a sort of artificial horizon orange backlit liquid crystal instrument display with the tachometer, boost indicator, temperature and fuel gauges seen as three-dimensional graphs tilting back out to the horizon.
The XT was loaded with features rarely found on small cars, such as a turbocharger, a computer-controlled engine and transmission, adjustable height suspension and an optional digital instrument cluster. The XT also had some features found on few other cars, such as an electronic in-dash trip computer, retractable flaps covering the door handles, and a single wiper blade for the entire windscreen. Pass-through folding rear seats and racing style front seats were standard equipment.