From its original introduction at the New York World’s Fair in April of 1964, the Ford Mustang was one of the great success stories of the Motor City, with more than one million cars sold in the first 18 months. But in the following years, as the trend-setting design grew bigger, fatter, and more luxurious, its sales volume steadily slipped away as well. By 1973, the Mustang was now almost intermediate in size, and meanwhile, sales slipped to around 135,000 units. The pony car was no longer earning its place in the Ford lineup.
Ford executive Lee Iacocca, often called the father of the Mustang, observed that Mustang buyers had not abandoned the Mustang, but rather, the Ford Motor Company had abandoned them. For the 1974 model year, it was time for a reset. The economy was slowing and fuel prices were rising. The Mustang would be returned to its small-car roots.
More than a foot shorter than the ’73 Mustang and rolling on a 96.2-inch wheelbase, the Mustang II was loosely based on Ford’s Pinto subcompact platform, although Iacocca was quick to insist that the two cars actually shared few components. Among other key changes, the Mustang II used an independent front subframe (labeled the “toilet seat” by Ford engineers) to isolate the cabin from drivetrain noise. Engine choices the first year were limited to a 2.4-liter four with 85 horsepower and a German-built 2.8-liter V6 good for 105 hp. From ’75 on, a 5.0-liter V8 was available, but with just 122 hp, later bumped to 138 hp.
While it wasn’t a real performance car by any stretch of the imagination, the Mustang II proved to be the right car for the times. Iacocca and crew had found the sweet spot in price, style, and packaging for the Mustang buyer of the ’70s. Sales zoomed up to nearly 386,000 units for 1974, a level the Mustang hadn’t seen since 1967—and hasn’t matched since. There would be four more generations of the Ford Mustang, and they all owe their existence to the 1974-78 Mustang II.