(UPDATED 11/18/2022)
The original Ford Mustang was the automotive equivalent of The Beatles rock band. The American auto industry had never seen anything like it — a small sporty car that proved so popular that almost 1.3 million were produced in only two-and-a-half years. Perhaps just as impressively, that success proved to be the foundation for one of the industry’s most enduring brands. It’s no accident that the Mustang is the Ford Motor Company’s only surviving passenger-car nameplate from the 1960s.
All that said, the Mustang’s early success has often been overhyped. This car created considerably more short-term buzz than it improved Ford’s longer-term competitive position.
In reality, the Mustang was not the stroke of genius that Lee Iacocca — the so-called “father of the Mustang” — apparently wanted us to believe. For one thing, the Mustang is a classic example of being in the right place at the right time. Journalist David Halberstam noted that the year the Mustang was introduced, 1964, “would prove to be the highwater mark of the American century, when the country was rich, the dollar was strong, and inflation was low. In the middle class even the young had money” (1986, p. 363).
Less obvious but perhaps more importantly, the Mustang’s popularity was so outsized because Ford’s competitors in the compact field were so weak in the mid-60s.
Yes, Iacocca should get credit for effectively exploiting those weaknesses. However, his ability to do so partly depended upon factors well outside of his control. Iacocca may have displayed admirable skills, such as in aggressively marketing the Mustang. But in the end, he also got really lucky . . . at least in the short run.
GM takes early lead with sporty compacts
The original Ford Mustang is a good example of the Woody Allen dictum that 80 percent of success is just showing up. In the early-60s it was obvious that smaller sporty coupes would be a growth market.
Pretty much every book or article about the original Mustang points to the high sales of the Chevrolet Corvair’s Monza. This top-end sporty model was noteworthy for offering then-unusual features such as bucket seats and a floor shifter. However, during 1961-64 almost every compact or mid-sized two-door model with sporting pretensions sold well.
In theory, GM was in the best position of the domestic automakers to become the industry leader in smaller sporty cars. Its compact bodies were arguably more stylish, partly because they were meaningfully lower than those produced by Ford, Chrysler, American Motors and Studebaker.
In addition, right out of the gate each of GM’s compacts — the Chevrolet Corvair, Buick Special, Oldsmobile F-85 and Pontiac Tempest — had two-door body styles with sportier rooflines than their four-door siblings.
In contrast, Chrysler’s compact two-door hardtops used the four-door sedan greenhouse up until 1967 (with the exception of the Plymouth Barracuda fastback). Ford didn’t offer a distinctive two-door roofline until it introduced a hardtop Falcon and Mercury Comet in mid-1963.
Aside from Studebaker, GM was also the first automaker to offer both a two-door hardtop and convertible in the compact class.
Perhaps most importantly, GM was quick to capitalize on the success of the Monza by introducing halo versions of its Y-Body compact cars. Buick primarily pitched its top-end Special, the Skylark, as luxurious. In contrast, Oldsmobile’s Cutlass and Jetfire models emphasized sportiness, as did Pontiac’s LeMans.
More than 131,000 Y-Body sporty models left the factory in 1963. That represented almost 41 percent of total production for that platform. Corvair Monza volume was even more impressive, with all two-door models tallying almost 174,000 units. Even the more utilitarian Chevy II’s SS hardtop and convertible racked up over 42,000 units.
All told, GM’s sporty two-door models almost reached 380,000 units in 1963. That was far above Chrysler (roughly 74,000 units), Ford (33,000) and American Motors (under 10,000 units). That gave GM almost 77 percent of the sporty compact market. Ford captured under 7 percent — less than half of Chrysler’s share.
Ford did so poorly with sporty compacts even compared to Chrysler because of Robert McNamara, a Ford Division general manager who moved up into higher levels of management before joining the Kennedy administration in 1961.
McNamara was a strong advocate for small, efficient and practical cars. He took Ford out of racing and rejected proposed Falcon designs that had the sporty proportions of the Thunderbird. Iacocca bemoaned the resulting production Falcon as a “granny car” (Halberstam, 1986, p. 361).
That was the good news for arch-rival GM. The bad news was that the non-sporty variants of the automaker’s compacts did not dominate the market as their full-sized siblings usually did. The biggest problem was the Corvair, which was so badly outsold by the Falcon in 1960-61 that GM rushed into production the utilitarian Chevy II in 1962.
The numbers were pretty stark: In 1960 Falcon output almost reached 436,000 units, whereas the Corvair barely hit 250,000. In 1961 the Falcon’s lead was similarly big — roughly 474,000 versus 284,000 units.
The Y-Body didn’t do all that well either. Mercury’s Comet outsold each of GM’s three entries in 1961-62 and all but the Special/Skylark in 1963. In the latter year competition tightened, but you would think the Y-Body would have sold better because it received a complete reskinning whereas the Comet was only modestly changed.
What made the Comet’s success doubly humbling was that Mercury had traditionally sold at much lower levels than GM’s premium-priced brands.
The technical features that made the Corvair and Y-Body more interesting to car buffs may have limited their popularity with the broader public. The most obvious example was the Corvair’s rear engine and swing axle, which were exotic to American drivers.
GM’s front-engine compacts also had problems. The Tempest sported a swing transaxle that resulted in handling almost as tricky as the Corvair’s. Meanwhile, the Special and F-85 shared an aluminum V8 that was lightweight but suffered from teething issues.
With further development the GM compacts might have sold better. Instead, the automaker abandoned this market in 1964 except for the hopelessly dowdy Chevy II and the ill-fated Corvair.
The result: By 1966 GM and Ford had virtually reversed roles. Largely on the strength of the Mustang, Ford’s share of the sporty compact market soared to 77 percent and GM’s dropped to 10 percent — just a hair below that of Chrysler’s. Perhaps even more strikingly, GM’s total compact production fell from over 1 million units in 1963 to roughly 245,000.
One thing to keep in mind is that the phenomenal sales of the Mustang did not reverse the decline of the overall compact market. Between 1963 and 1966, compact production fell by 24 percent — from almost 2 million units to 1.5 million. This reflected all four remaining U.S. automakers shifting their attention to mid-sized cars. We will return to that topic shortly.
Chrysler shows promise but not ready for prime time
In theory, Chrysler could have done quite well in the sporty compact market. The engineering of its A-Body cars lacked the problematic quirks of GM’s but arguably had better road manners than Ford’s. The main problem with the first-generation Plymouth Valiant and Dodge Lancer was their sci-fi styling. That was substantially fixed with a redesign in 1963.
Chrysler was also quicker than Ford to offer sporty variants. In 1962 a two-door hardtop was introduced along with a top-end Valiant Signet and Lancer GT. Once the cars were restyled, sales of these sporty models were respectable — around 20 percent of total A-Body output.
Chrysler even introduced a fastback shortly before the Mustang was launched in the spring of 1964. The Valiant-based Barracuda boosted sales, but not enough to really move the needle. In 1966, A-Body output remained stuck in the same upper 300,000-unit range that it was in 1963. Stability was certainly better than a decline, but during this same time period Ford’s output had soared by 71 percent.
In a way it is surprising that Chrysler’s compacts didn’t sell better once they were restyled. They ranked well with Consumer Reports (1963), whose annual auto issue lauded the Plymouth and Dodge siblings for their “high standard of quality” in such areas as handling, ride, brakes and automatic transmission.
A big part of the problem was still the styling. Although it was somewhat better than the Chevy II and Falcon, the second-generation A-Body lacked curved side glass and suffered from a number of quirks. For example, the Dart GT was loaded down with too much chrome and the Barracuda’s fastback was ill-proportioned. In addition, facelifts for 1966 ditched the A-Body’s nicely rounded fascias in favor of a rather generic and blocky look.
In the end, the A-Body’s main problem was its relatively low corporate priority. That was understandable, because Chrysler was trying to rebuild after a sales collapse in the early-60s. But as we discuss here, the automaker arguably overextended itself by trying to compete model-for-model against Ford and GM.
Independents defanged by Eisenhower administration
Since our theme is Iacocca getting lucky with the Mustang, we should bring up a more contextual point that is pretty much never mentioned in the auto buff media: Ford faced so little competition in the sporty compact market partly because of public policy decisions made a decade earlier.
Four independent automakers entered the compact field during the first half of the 1950s. Unfortunately, a brutal price war between Ford and Chevrolet played a major role in pushing three of those automakers out of the market. This was not inevitable. The Eisenhower administration could have initiated antitrust actions against GM and Ford. Instead, it turned a blind eye.
Also see ‘Was the ‘Ford blitz’ to blame for the collapse of independent automakers?’
One could reasonably argue that some of those compact entries would not have been viable even if the price war — which is commonly referred to as the “Ford blitz” — had not occurred. For example, the Hudson Jet may have been too tall, heavy and expensive to have survived even under ideal market conditions.
On the other hand, suitably updated versions of the Aero Willys could have sold quite well in the late-50s and early-60s, when smaller cars became blazingly popular. Just as American Motors was able to use a big jump in sales of its compact Rambler to modernize its lineup by the mid-60s, perhaps at least one other independent automaker might have been able to do so as well.
Studebaker would have been most likely to jump into the sporty compact market with a Mustang-like entry. The automaker pioneered the personal coupe in 1953 when it introduced low-slung two-door models styled by Raymond Loewy’s consulting firm. Roughly 79,000 of the so-called “Loewy coupes” left the factory in their first year despite significant production problems. These cars might have better maintained their sales momentum if the Ford-Chevy price war had not gotten out of hand.
Despite Studebaker’s subsequent financial troubles, it did offer two sporty compacts in the 1960s — an updated Hawk and the Avanti. However, the prospects of both cars were significantly undercut because of the dying automaker’s lack of development dollars. The 1962 Gran Turismo Hawk didn’t receive enough of an updating to be viable. Meanwhile, Studebaker management decided that they could only afford to give the Avanti a fiberglass body, which limited it to being a premium-priced, low-volume car (go here for further discussion).
By the same token, American Motors might have entered the sporty compact market more quickly in the 1960s if it had not faced such a close brush with death in the mid-50s. In an effort to improve the automaker’s economies of scale, company head George Romney drastically cut back the number of models and body styles offered. From 1958 to 1962 AMC was the only American automaker that didn’t offer a single two-door hardtop.
When AMC finally did add some sporty models, it took a few more years for the automaker to get a decent feel for that market. As a case in point, a sporty fastback called the Marlin was offered as a mid-sized car rather than as a compact, which likely would have sold at least somewhat better.
Meanwhile, the 1966-67 Rambler American offered a high-end Rogue model, but it suffered from a tacky two-tone paint job, too much chrome and too high of a price relative to the Mustang (go here for further discussion).
The greater the number of domestic automakers, the greater the likelihood that one or more of them would have offered well-received sporty compacts. Such cars might not have sold as well as the Mustang, but they could have changed the narrative. Perhaps competition would have been robust enough that they weren’t referred to as “pony cars.”
If one is skeptical that an independent could have hit the big leagues with a Mustang-like coupe, recall that in 1960-63 the Rambler sold an average of 411,000 units per year despite aging products, a relatively weak dealer network and intense competition from the Big Three.
Iacocca owed a debt of gratitude to McNamara
The lack of competition in the sporty compact market in 1964-66 left an unusually big opening for Ford. A more risk-averse executive might not have exploited it so aggressively, but Iacocca had one key advantage his contemporaries at other domestic automakers did not possess: Ford had a strong track record with the four-seater Thunderbird.
This is a key example of how Iacocca’s success was heavily built upon major decisions by McNamara. During the late-50s and early-60s the Ford executive was arguably the industry’s most aggressive disciple of product proliferation.
McNamara quite rightly recognized that the Edsel’s failure wasn’t just one of timing and execution. Instead, he presciently saw that Ford’s future success depended upon developing new markets rather than slavishly copying GM’s hierarchy of brands strategy. This mindset — which was quite subversive for the time — made it much more likely that a one-off design like the Mustang’s would gain approval at Ford than at any other domestic automaker.
Also see ‘1958-76 Thunderbird: The rise and fall of the Ford that shook up GM’
As a case in point, GM sat on the sidelines for five years before fielding a direct competitor to the four-seat Thunderbird that offered distinctive sheetmetal. This was arguably a rational decision. In 1962 the output of the Pontiac Grand Prix and Oldsmobile Starfire came within 6,000 units of matching the T-bird’s. That was a pretty good performance when you consider how they were only differentiated from the regular models by top-of-line features such a bucket seats and a center console. Of course, it probably helped that the Grand Prix and Starfire were priced lower than the T-Bird.
The Y-Body compacts could have performed a similar role in competing against the Mustang. But once they were shifted to mid-sized cars, the Corvair was GM’s most promising Mustang competitor. As discussed further here, the collapse of Corvair sales in 1966 may have helped the Mustang reach its peak production of almost 608,000 units. Even so, GM might have gotten the better end of the deal.
GM utterly clobbered Ford in mid-sized field
The same year that the Mustang hit its peak, roughly 1.18 million GM mid-sized cars left the factory. That was 690,000 units more than Ford’s mid-sized entries, the Fairlane and newly upsized Comet.
Iacocca may have generated a great deal of media buzz from the Mustang’s success, but GM was quietly raking in bigger sales in the mid-sized field. Just as importantly, that volume would prove to be more stable over time than the Mustang’s.
Ford wasn’t just failing to keep up with GM in the mid-sized field. During the second half of the 1960s, Chrysler’s volume was higher than Ford’s in four out of five years. Even American Motors beat Ford in 1965.
Ford’s mid-sized entries performed so poorly between 1965-69 that they averaged only 18 percent of that market. This was during the same period of time when the automaker was averaging 26 percent of the total domestic market.
I don’t mean to suggest that this was a zero-sum game where Iacocca had to choose between investing either in sporty compacts or mid-sized cars. Where he arguably erred was in placing too much emphasis on the Mustang.
Mustang opens door to niche vehicles — for good and ill
Up through the mid-60s the American automakers had mainly tried to appeal to status-conscious consumers by offering a hierarchy of brands. This was most highly developed at GM, where a car buyer could show they were moving up in the world by switching from the low-priced Chevrolet to a higher-priced Pontiac, Oldsmobile, Buick and — at the pinnacle — Cadillac.
The first big break from this strategy was the four-seat Thunderbird. Even though the car was sold through plebeian Ford dealers and was much smaller than traditional premium-priced cars such as the Buick Electra, it outsold them.
The Mustang’s even bigger success further legitimized the value of niche vehicles. Here I am referring to cars and trucks that attempt to appeal to a narrow range of buyers with distinct sheetmetal — and perhaps even a unique platform.
The downside of niche vehicles has always been that they are more expensive to develop than by merely adding a new trim level or body style to an existing product line. And since Detroit has usually placed an emphasis on offering trendy styling rather than practical features, niche vehicles have tended to operate on more pronounced boom-and-bust cycles than their mass-market counterparts.
The Mustang offers a classic example of this phenomenon. It went up like a rocket and came down rather quickly as well. That partly reflected the rest of the American automakers playing follow the leader. Between 1967 and 1970, the pony car field gained six entries.
Alas, the party soon ended — total pony car production fell from almost 1 million units in 1967 to under 349,000 in 1972. That represented a 65-percent drop.
Ford was better insulated from the pony car market’s decline than the rest of the auto industry because it was the first one in. Almost three million Mustangs left the factory between its introduction in the middle of 1964 and the end of its tenure as a compact 10 years later. In addition, the Mercury Cougar’s production topped 614,000 units by the time it was reclassified as a mid-sized personal coupe in 1974. That added up to 3.6 million, which was a pretty good run for two niche vehicles.
Other automakers weren’t so lucky. Both AMC and Chrysler likely lost money on their pony car entries, but the latter may have experienced the biggest financial hit. The reason why illustrates the risk of niche vehicles. When Chrysler decided to dramatically increase its presence in the pony car field in 1970, it mistakenly assumed that total sales would rise to 1.5 million — and that the Plymouth Barracuda and Dodge Challenger would together generate least 200,000 units per year (Bouwkamp, 2020). Instead, they mostly hovered around 50,000 units (go here for further discussion).
GM may have weathered the boom and bust best because it kept its second-generation F-Body in production for 11 years. That was long enough to catch another boom market in the late-1970s. In contrast, Ford switched the Mustang to a subcompact platform — with mixed results. Everyone else cut their losses and left the field.
A big reason that the pony car market went bust was because automakers made the cars bigger, glitzier and more powerful. Iacocca later acknowledged, “The Mustang market never left us, we left it” (Wikipedia, 2020a).
Even if Detroit hadn’t guessed wrong about what the public wanted in an early-70s pony car, automakers were nevertheless taking a substantial risk by investing in stand-alone platforms for such specialized cars.
Perhaps the best comparison is with mid-sized muscle cars. They shared virtually all of the same sheetmetal as more mainstream two-door coupes. Because of this, when muscle car sales imploded in the early-70s, automakers could much more easily — and inexpensively — shift with the market.
Was the Mustang’s cannibalization worth it?
The Mustang did give Ford a meaningful short-term bump in market share. The brand captured 41 percent of the low-priced market in 1966 — up nine points from 1964.
Alas, the good times didn’t last. When the Mustang was hit with a first wave of competition in 1967, Ford’s market share fell back to 36 percent. The brand didn’t see another meaningful increase until 1970, when the new compact Maverick generated roughly 579,000 units.
The Mustang may have brought more customers into Ford showrooms, but it also appears to have cannibalized sales from elsewhere in the lineup. The Fairlane may have been somewhat impacted — particularly in 1965, when output bottomed out at 224,000 units. However, the biggest loser was likely the Falcon, whose production fell by almost 79 percent between 1964 and 1967.
So was the Mustang worth it? The car was developed on what was a fairly small budget for Ford — $65 million (Mueller, 2010). Did this give the automaker its biggest bang for the buck, or might it have reaped more sustained sales — and profits — by keeping the Falcon as a real compact and offering a sporty high-end variant called the Mustang?
Ford instead shifted the Falcon to its mid-sized platform in 1966. This undercut the whole idea of the car because it was four inches wider, three inches longer and 150 pounds heavier. Although list prices were still competitive with other compacts, the Falcon wasn’t as light and nimble as it used to be. The wagon even had all of the same sheetmetal as the mid-sized Fairlane from the A-pillar back.
Also see ‘Compact cars became the neglected stepchildren of U.S. automakers’
You can get a hint of the road not taken by looking at the 1970 Ford Maverick. This entry-level compact was based upon the Mustang body but had five inches chopped out of the wheelbase. A four-door version of the Maverick was later introduced that had a roomier back seat due to a seven-inch-longer wheelbase. This was essentially the original Falcon with a more modern and stylish body.
The introduction of the Ford Maverick in mid-1969 was a tacit admission that Iacocca had miscalculated — not once, but twice. Moving the Falcon to a mid-sized platform was a bad move because import sales were on the rise in the second-half of the 1960s. In 1967, when the Falcon bottomed out at roughly 64,000 units, Volkswagen almost reached 455,000 — and would hit a peak of almost 583,000 in 1970.
Also see ‘Four ways Lee Iacocca contributed to the decline of Ford and Chrysler’
Iacocca also miscalculated with the Mustang. The car’s initial success was based upon being an entry-level compact that had been dressed up a bit. Ford would have been more likely to have kept that winning formula if the Mustang had been merely a sporty variant of the Falcon rather than a niche vehicle with a unique body.
Halberstam suggested that the Mustang illustrated how Iacocca “had almost perfect instincts for the market” (1986, p. 355). That may have been true in the narrow sense that he could be a brilliant tactician. However, the Mustang also showed how Iacocca’s longer-term vision was just as myopic as the rest of the U.S. automakers’ high-level leadership. He was so steeped in Detroit groupthink that he didn’t recognize how big of a threat imports would become. Halberstam noted that, like Iacocca’s boss Henry Ford II, he “wanted big, creamy, plush cars” rather than the smaller ones that McNamara had championed (1986, p. 375).
Why question Iacocca’s legacy?
The point of this story isn’t to throw darts at Iacocca, but to acknowledge the multiple ways that the Mustang was a stroke of luck. Arguably Iacocca’s biggest break was that competition in the compact field had grown exceptionally weak by the mid-60s.
Indeed, the Mustang’s larger-than-life success is good example of how Iacocca rose to power at a time when U.S. automakers had become so sclerotic that even a moderately street-savvy auto executive could really stand out — particularly if they had a flair for publicity.
While we’re at it, let’s also acknowledge how the Mustang was a marketing sensation that, in the long run, proved to be more sizzle than steak. The car gave Ford only a fleeting increase in market share while adding the cost burden of another distinct body that siphoned away development and marketing resources from more stable sources of sales, such as mid-sized cars and the Falcon.
Letting the Falcon die on the vine was Iacocca’s biggest mistake of the second-half of the 1960s. Ford needed to maintain a strong entry-level compact in order to compete against a rising tide of imports. That was especially needed after Iacocca led a successful fight in the early-60s to kill a subcompact car McNamara had championed.
Also see ‘Was Ford right to kill the front-wheel-drive 1963 Cardinal/Redwing?’
If McNamara had stayed at Ford through the 1960s, its lineup of cars would likely have been less flashy but more in alignment with the public’s shift to smaller cars. And if Ford had taken the industry lead in holding back the imports, McNamara rather than Iacocca might be viewed today in heroic terms.
Instead, we got the Mustang . . . and Ford was ultimately overrun by the imports.
NOTES:
This article was originally posted on June 1, 2020 and updated on Nov. 18, 2022. Production and market share figures were calculated with data drawn from the following sources: Auto editors of Consumer Guide, 2006; Gunnell, 2002, 2004) and Wikipedia (2020b). The figures between these sources do not always align, so judgments were made about which data appeared to be most accurate.
Share your reactions to this post with a comment below or a note to the editor.
RE:SOURCES
- Auto editors of Consumer Guide; 2006. Encyclopedia of American Cars. Publications International, Lincolnwood, Ill.
- Barnes, Bart; 2019. “Auto industry icon Lee Iacocca dies at 94. He helped launch the Ford Mustang and saved Chrysler from bankruptcy.” Washington Post. Posted July 2.
- Bouwkamp, Burton; 2020. “1970-1974 Dodge Challenger / Plymouth Barracuda memories.” Allpar.com. accessed May 7.
- Classic Car Database; 2020. “Search for specifications.” Accessed May 27.
- Consumer Reports; 1963. “1963 Automobile Ratings.” Published April; pp. 173-184.
- Gunnell, John; 2002. Standard Catalog of American Cars, 1946-1975. Revised 4th Ed. Krause Publications, Iola, WI.
- ——; 2004. Standard Catalog of Volkswagen, 1946-2004. KP Books, Iola, WI.
- Halberstam, David; 1986. The Reckoning. William Morrow & Co., New York, NY.
- Mueller, Mike; 2010. The Complete Book of Mustang: Every Model Since 1964 1/2. Motorbooks, Minneapolis, MN.
- Wikipedia; 2020a. “Ford Mustang.” Page last edited May 3.
- ——; 2020b. “U.S. Automobile Production Figures.” Accessed March 28.
ADVERTISING & BROCHURES:
- wildaboutcarsonline.com (Automotive History Preservation Society): Studebaker Avanti and Hawk (1963)
- oldcaradvertising.com: Buick Skylark (1962); Ford Mustang (1964 1/2); Ford Thunderbird (1961); General Motors (1955); Mercury Comet (1961); Oldsmobile Jetfire (1962)
- oldcarbrochures.org: Aero Willys (1953); Chevrolet Corvair (1960); Dodge Dart (1965, 1966), Lancer (1962); Ford Maverick (1971); Oldsmobile Starfire (1962); Pontiac Grand Prix (1962), GTO (1972), LeMans (1962, 1963); Rambler American (1967)
Iacocca was lucky, but, regarding the role of luck, Oprah Winfrey put it best – “Luck is when preparation meets opportunity.” The market was there for the taking, and Iacocca and his Fairlane Group did the research and market studies necessary to develop a vehicle that could exploit it. And while the Mustang did prove to be a “flash in the pan,” that has more to do with what Ford did with the car than any shortcomings with the original car itself. Ford kept making it bigger to compete with the muscle cars (which meant a body big enough to swallow the biggest V-8s). For me, the line was crossed in 1969 (I find the 1967-68 cars to be a good second act to the original cars, although others may differ). The 1971-73 cars are my least favorite – far too big and bloated.
The Mustang market didn’t really go away – witness the success of the Ford Capri and Toyota Celica in the early 1970s. While we can quibble about the execution of the final product, I do give Ford and Iacocca points for recognizing this, and trying to address it with the 1974 Mustang II.
The other big mistake here was walking away from the compact market with the 1966 Falcon. Ford turned it into a truncated Fairlane, and it just didn’t work. The 1966-69 Falcons are the last attractive domestic compacts from a styling standpoint, in my view. Ford would have been better off if it had continued to refine and develop the 1964-65 models, which did have a proven audience.
The Mustang wasn’t at fault here – for 1964 and 1965, Ford’s Mustang and Falcon addressed the desires of buyers who wanted smaller cars. The Mustang catered to people who wanted something small, economical (contrary to our perception today, a large percentage of 1965-66 Mustangs went out the door with the six) and stylish. The Falcon catered to sedan and wagon buyers looking for something more practical. Ford’s mistake was abandoning that approach in stages – in 1966 with the Falcon, and in 1969 with the Mustang.
Geeber, I concur. I did not find the 1964-1/2 through 1966 Mustangs to be all that attractive. The 1967-1968 refresh was much more handsome than the originalu, although I learned how to drive a stick-shift in my pastor’s 1966 170-cu.in. six with a three-speed manual. The entry-level six-cylinder Mustangs were balanced. To make a 1964-1968 289 Mustang safe to drive in all conditions, the car needed upgraded suspension and a minimum of front disc-brakes. The Mustang, though, was an entry-level sporty car for young women who would never buy a Ford Falcon as their first new car when for a few dollars more they could drive a much sportier car.
Interesting about the Aero Willys, which seems like the forgotten car even by buffs like us. The 108 inch wheelbase seems right sized, was unit construction and a facelift like what the 1955 Packard did would go a long way. WHat was Toledo’s production capacity? My gut feeling by reading articles and comments in this magazine is that 150k per year is the practical minimum for profitability.
My guess is that the Aero could have been profitable at production far lower than 150,000 units per year. According to James Ward (1995), Packard’s breakeven point was reportedly 80,000 after modernization efforts were implemented in 1955; Hudson’s was reportedly around 75,000 units before the AMC merger (Langworth, 1993).
Richard Langworth quoted Roy D. Chapin Jr. as saying, “I don’t know where [the theory of breakeven being higher than maximum output] comes from. They [Hudson] could do 175,000 cars a year on one shift, two shifting — there was nothing to it. If they could have sold them they’d have made a lot of money” 1993, p. 126).
Note that when talking about Toledo’s breakeven point, we would presumably include more than the Aero’s production. The car needed to sell better than it did, but it didn’t need to single-handedly carry the firm. In addition, because the Aero’s basic design could have been kept on the market an unusually long time without a whole lot of updates, it could have penciled out better.
How many dealers did Willys have ? I am going to guess that if Willys had a more significant dealer network in 1955, more Aero Willys would have been sold. Unfortunately, like Nash, Hudson, Kaiser and even Studebaker, by 1955, Willys did not have the sales power to make a very interesting car a success.
I don’t want to hijack this thread. But, the best calendar year production figure I could find was around 40k for 1953. What was interesting in our constant pipe dreams of the Great Independent Merger which rarely mentions Willys, is this- The unibody hull was made by Murray in Detroit. Were this made available to say, Hudson, or even better Studebaker whih had a history of smaller cars could let these firms put on their own sheetmetal and running gear.
Kim, if Hudson had built the Aero Willys instead of investing in the 1954-Ford-like Jet, would Hudson been in better shape when they merged with Nash ? Part of me, the idealist, says yes, but the realist part of me says, it just would not have mattered. If Chevrolet or Ford had sold the Aero Willys, it might have cannibalized sales from the regular cars. I only rode in a 1955 Aero Willys once. The car deserved better, although it lived a good life outside the U.S. for Kaiser.
And Ford when they acquired Willys do Brasil in 1967 (other sources said 1968), it inherited the Aero Willys who was reskinned in the mid-1960s and Ford do Brasil had toyed with the idea to do another facelift with the Brazilian Aero for the 1970s to go against the Brazilian Dodge Dart and Chevrolet Opala.
https://www.flickr.com/photos/hugo90/2316202598/in/photostream/
Strange then Ford didn’t thought to give a second life of the 1966 Falcon body in Brazil like they did with the Galaxie.
IIRC the first remake looked vaguely like a Fiat. This looks like Chrysler is assigned to facelift the ZIL
Don’t discount luck,luck is how you win the lottery! Ford was prepared and based their Pony car on the existing Falcon platform. They also made the most basic Mustang an attractive package with buckets,floor shifter,carpeting,and full wheel covers. There was no real stripper Mustang. Every Mustang had “the look”,that was what the public was really after.
Even if Iacocca was lucky,so was the American buying public. I feel the Mustang is the “Every Man’s Aston Martin.” It has been a fun and rewarding car to own and drive. I’ve got two myself!
Great article Steve. Length was certainly appropriate for the ground that needed covered.
Given that the original volume call was 100,000 (Wiki), probably any sales over 200K needed to be counted in the lucky column. Mustang sales did eventually settle into the 100-200K range. Perhaps the initial spike was simply pent up demand from true blue Ford buyers who didn’t cross-shop the other Detroit companies.
If Iacocca owed a debt of gratitude to McNamara, and I agree with you that he did, then isn’t the reverse also true when Lido got T-Bird and Lincoln off McNamara’s Wixom unibody and onto volume BoF platforms?
Ike did need legislation… antiNance directed at Packard… but let’s not go there!
I never really understood the strong objection to the later Mustangs. Wheelbase was the same or nearly so through’73. Length grew by only a half a foot. Yes, width grew by same but was it really that big a deal? My favorite Mustang is the base ’71 convertible, a beautiful car that is not too big or small. Makes the original look boring. The ’69 fastback is arguably the alternative iconic Mustang. In base form but with the Boss 302’s clean rear fenders it would be perfect.
Did the ’64 Mustang program have anything to do with the ’66 Falcon program? Somebody out there who knows the history might shed light. They could have been discreet programs but then again not, the Mustang consuming a compact ’66 Falcon restyle. What does seem apparent is that Mustang initially made so much money that it seems the money for Falcon was there, if not for ’66 then soon after. For all we know, Mustang funded Maverick. I say that if you are a car company that can be that successful, even if only for a 3-4 year run, then you gotta go for it.
It’s that other equine that makes my what-if mind quickly change from walk to trot to canter. More than any other car , the Pinto represented Ford’s response to the Beetle and the 2-door versions of the imports. Steve, you have mentioned elsewhere that Pinto would have benefitted from Ford’s European FWD P/T. I totally agree. Question is, how?
Here’s one answer: with removal of the trans tunnel, the steering wheel could have moved inboard a few inches to get the driver and front passenger off the doors, and the front seats could have been widened for improved comfort. There would have been some elbow bumping when the passenger seat was occupied, and no center console storage space, but at least when commuting alone, driver spaciousness would have been very good for such a small car. Of course, absence of a rear axle would have enabled safer packaging of the fuel tank and more space to package the spare such that load floor would be completely flat.
The problem with this what-if has to do with this article’s main character. Could Mustang II have successfully thrived as a FWD version of what it become in 1974, now with the new front seat package? I don’t know, need to ponder…
Steve, this is a great analysis. A couple of things, I do not think that the 1962-1964 Chevy II Novas were dowdy cars. The Novas were in the same league as the Falcon Futura Sprints. Of course, after April 17th, 1964, the Futura Sprint was no longer needed by Ford. The 1955-1957 two-seater Thunderbird were at least stylistically related to the 1955-1957 full-size Fords, and the four-place T-birds of 1958-1960 still have Ford styling clues that one could find on the 1958-1959 Galaxies, so selling Thunderbirds at Ford dealerships made sense. Even the 1961-1966 T-birds made sense at Ford dealerships. Between 1967 through 1971, I am not sure where Thunderbirds should have been sold. Once again, heading into the 1970s, it should have become apparent to all that there were too many models with too much overlap and at Ford and G.M. no attention as to where the auto markets were heading. The Vega was under-developed and the Pinto was a car that should have been front-wheel-drive.
Yes, Iacocca was lucky, but the Mustang / post-1964 Falcon was a car not much more sophisticated than the Chevy IIs. Frankly, the Valiants and the Darts were more substantial cars for the money, but they were not stylish beyond solid transportation. In my opinion, the Barracuda was not an attractive car until the 1967 restyle. The G.M. “Panther”-based pony-cars were not as attractive, in my opinion, as the 1967-1970 Mustangs, and it took the 1970 Camaro / Firebird to give those cars an identity beyond “Me Too”! It is sad that the Corvair had its limitations and did not survive. The 1965 Corvair was a styling masterpiece and was just as significant as the styling introduced for 1960. But perhaps the lesson to be learned from this is that a car with style, aspirational luxury interior but with solid underpinnings should be a winner. It seems to be the formula for the Honda Civic SI. I think people want simplicity with distinction. The original Mustangs offered this in an affordable package.