We're sticking with one of Lee Iacocca's metalbabies this week. One of the very first things Iacocca did when he became president of the Ford Motor Division in 1970 was to push for the creation of this very car. So yeah, Ford built this
on purpose.The Mustang II, in the popular imagination, was/is an insult to the proud legacy of the original ponycar. Just a decade after the introduction of the original Mustang, Ford traded its legacy of smart looks and ferocious performance in order for the Mustang to become ... a Pinto in a track suit. Gone were the 390s and Cobra Jets, replaced by a 2.8 liter V-6 and ... the same 4-cylinder engine as the Pinto. You read that correctly: when the Mustang II debuted in 1974, not only couldn't you get a red-hot V-8 motor, you couldn't get a V-8 at all.
Way to trash the legacy of a proud product, Lee. Did someone drop LSD into the executive dining room coffee pot? Who asked for this, and who was going to buy this? We know what a Mustang is supposed to be: a hard-to-handle ferocious beast of a car that can outrun anything not powered by a jet engine. This thing could lose a drag race to a lawn tractor. What is the meaning of this??!? I thought this was America.
(Hey, Siri, is that enough fake outrage to keep the Boomers happy? I don't want to keep them up late, the morning crew at Hardees doesn't need uber-cranky customers.)
Show me a discussion about the worst cars of all time, and I guarantee the Mustang II will show up. I can't say it doesn't belong in that conversation; it really was a Pinto in a track suit, after all. But if you're going to call it a bad idea, you'll first have to reckon with what the car market was like in the mid-1970s -- and how time has blurred memories of what the original Mustang actually was.
The original Ford Mustang was, underneath its nice-looking exterior, a Ford Falcon. The Falcon was a poverty-spec car, and it looked like one. There is, of course, nothing wrong with that. After all, we just talked about the Plymouth Reliant last week. The Falcon competed with the Chevy Corvair and Dodge Dart/Plymouth Valiant twins down at the low end of the American car market.
In 1961 Chevrolet introduced a special version of the compact Corvair called the Monza. It looked like a much sportier version of the regular car, but it was no faster and didn't really handle any better. All show and no go, in other words. But it sold well and got a lot of good press. So naturally Ford wanted in on the action; hence, the original Mustang. While the Stang could be made to be a very fast car, in base form it was ... a Falcon in a track suit.
The muscle car era peaked a few years later and the Mustang evolved to keep up. By 1971 it was made longer and wider to accommodate the 429 Cobra Jet engine, the most ferocious motor Ford made. Then a combination of unleaded gasoline (mandatory after 1974), increased safety standards, emissions controls, and (most of all) rising insurance rates nearly killed the muscle car market entirely. (The Cobra Jet that the 1971 Mustang was designed around wound up only being available in 1971, for example.) This is why 1970s American cars are either Spartan transportation appliances, gaudy discomobiles, or festooned with two-tone paint and vinyl roofs. (One could argue the Mustang II was all three of these.)

Customers still wanted high performance, but they couldn't afford the insurance. They wanted great fuel economy but the technology was still too primitive. Since Detroit couldn't give its customers the two things they wanted most, it gave them luxury. After all, if it's going to take you 16 seconds to go from 0 to 60 mph, and you're going to get 12-15 MPG while doing it, you might as well have a comfortable seat. And a vinyl roof. And color-keyed door pulls. Or you could make a car look even more sporty without actually increasing its performance. The Mustang II did this with its Stallion, Cobra II, and King Cobra packages, which were all largely (or entirely) cosmetic, and added luxury with its Ghia package, which
was entirely cosmetic.
But make no mistake: a significant portion of all previous Mustangs from 1964 through 1973 were also low-performing vehicles for people who just wanted to look cool. (Bill Clinton earned cool points for owning a Mustang convertible until everyone found out it had a 6-cylinder engine.) Starting in 1969, one could even purchase a posh Mustang Grande, filled with luxury bits but requiring no engine or suspension upgrades. Therefore, the Mustang II was not a departure from the original formula. It was a continuation of it, being based on Ford's smallest car, and looking quite a bit cooler, but not necessarily being any faster.
Then there was a gas crisis in 1974, and suddenly nobody wanted V-8 engines. So it shouldn't surprise you to learn that the 1974 Mustang II sold almost three times as well as the 1973 Mustang. And, having actually been there, I can tell you that it was quite a popular car, even before Farrah Fawcett started driving one on Charlie's Angels.
If the dirty little secret of the original Mustang was that only some of them were fast, or even sporty, then the dirty little secret of the Mustang II is that it wasn't really any different from everyone else's little sporty cars in the mid-1970s. Sure, the Camaro and Firebird were still around for those who wanted V-8 thunder, but smaller imported cars like the Datsun 240Z, Toyota Celica, Volkswagen Scirocco, and even the Mercury Capri were rapidly gaining popularity in America. They weren't fast either. They just didn't carry the burden of a legacy, so they haven't become a bad-car punchline.
Also, the Chevy Monza was even worse, because at least Ford's 4-cylinder engine lasted more than 50,000 miles.
Still, some version of the Mustang has to be its low water mark, and it's obviously this one. Second place goes to the bloated transitional 1971-1973 models, but I actually like those.
Have I ever owned or driven one? Nah. We had a Pinto when I was in grade school. I hated that thing and I was so glad it was never our only car.
("Cobra bites man." ad photo: “1978 Ford Mustang II Cobra II Advertisement People Magazine October 17 1977” by SenseiAlan, CC BY 2.0)