The latest I've heard is that they're still working on it, but that we'll probably see a Subaru diesel first.
Subaru had been working on their own hybrid system a few years ago, but that all changed once Toyota took 8.7% ownership. The latest I've heard is, yes, there is a hybrid in the works, but it will likely use a version of the Toyota hybrid system and not the earlier Subaru hybrid system. When that will occur, I don't know. My guess is probably not before 2010 or 2011—but that's just a guess.
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