The much larger 1973 Mustang was a far different car than the original 1964 model. Ford was deluged with mail from fans of the original car who demanded that the Mustang be returned to its original size and concept. Upon taking over the presidency of Ford Motor Company in December, 1970,
Lee Iacocca ordered the development of a smaller Mustang for 1974 introduction. Initial plans called for the downsized Mustang to be based on the compact
Ford Maverick, which was similar in size and power to the
Falcon upon which the original Mustang had been based. Those plans were later scrapped in favor of an even smaller Mustang based on the subcompact
Ford Pinto. Such a car, it was believed, could better compete with smaller, sporty import coupes such as the
Toyota Celica and the
Ford Capri, then built by Ford of Germany and Britain, and marketed since 1970 in the U.S. by
Mercury as a
captive import.
Dubbed "Little Jewel" by Iacocca himself, the car sold well, with sales of more than 400,000 units the first year. (It is worth noting that four of the five years of the Mustang II are on the top-ten list of most-sold Mustangs.) The Mustang II featured innovations such as
rack-and-pinion steering and a separate engine sub-frame that decreased noise, vibration, and harshness.
The
Arab oil embargo, skyrocketing insurance rates, and
United States emissions and safety standards destroyed the straight-line performance of virtually every car of the period. In 1974,
Chrysler ended production of the Barracuda and its stable mate, the
Dodge Challenger.
American Motors also discontinued the
Javelin at the end of the 1974 model year.
GM nearly discontinued the
Camaro and
Firebird after 1972.
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