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Everything seems nice and swell during the early phase up to guarded levels, then BAM I get completely destroyed on the next level of alertness.

What am I missing? Should I be conserving my power cells for combat instead of smashing out the upgrades as fast as possible? Should I rethink my team makeup? Should I not spread my kills across every member of crew, and just try and stick with 4 strong people?

Honestly, it feels like the normal difficulty should be BEDLAM. I want to get the unlocks, however it's not possible on easy.
Start with the upgrades first, especially engineering and bio, then armory. If you run out of crude or passengers, the game is over. And don't forget to use the equalizers early on if need be (health).

Make every side mission to get more ressources, and when you got enough energy cells, start a fight with a nuker. Early on, this is often an instant lvl up (note that the character you have selected while nuking get's all the kills).

What's your team setup? My suggestion: Get two frontliners to lvl 3 asap and put all the skill pts into damage. Depending on the emenies I usually go into fights with 1 or 2 frontliners, 1 deadeye, 1 or 2 gunslinger. I seldomly use trenchers, although I try to have at least one leveled up just in case.

When the fight starts, I usually keep my group tight together and wait couple of turns while the enemies approach. When they are near enough and (ideally clustered together) - NUKE! :P

If you got yourself a strong team to begin with, swap 1 or 2 members out to level up other members, so you have spares if people get wounded and need to heal or even get killed. And they will get killed, eventually. ^^
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kju42: snip
Thank ya kindly. I guess I had the right idea of trying to get the upgrades out of the way quick. My team setup was just one of each class... because I really have no idea on setup strategy lol.

Sometimes I forget the heal equalizer is there, which probably doesn't help either. Not to mention, I only just found that if you have your people adjacent to whoever receives an equalizer, they get it too.

Cheers.