Enclosed vehicle, but bear in mind that it's a 12 year old vehicle, so it's hardly a perfectly sealed environment or a particularly quiet ride. Since posting the above, I've noticed that the volume and quality are much better when the other party is on a land line and not another cell. I still haven't tried the unit with encryption off...in fact, this posting has reminded me to give that a try. I'll amend the post above in the next few days after experimenting.