In layman's terms, what exactly is 'torque' in a car and what does it do?

Answer 1

Take two men, each cranking a pulley winch. One man is able to crank very fast, performing a lot of work in a given time. That's horsepower. The other man is able to crank up a very heavy load. That's torque. The ability to lift a total amount of load in a given time is given a horsepower rating, while the ability to lift a given load is given a torque rating.

In physics-speak, horsepower is in units of power, while torque is in units of force, together with a lever arm. See wiki articles to see the difference.

Peformance cars with high torque engines, like Corvettes, have quicker acceleration, while high horsepower engines are needed for high top speeds.