I had a 99 Forester with the 2.5 and 5 spd...I would average 30 combined and maybe 32 on the highway.
The auto trans is your choke point on your Subi. I doubt mid 30s MPG on the highway (65mph plus) is attainable without serious re-gearing, trans swap with re-gear or engine swap to 2.2L with trans swap/re-gear.
Has the head gasket been replaced yet? If I recall the 97 2.5L is a problematic one.
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