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Mustang II made its appearance in the era of the energy crisis: customers were, Ford thought, increasingly economy-conscious, and the powerful American cars were losing ground to lighter, smaller European and, increasingly, Japanese imports. Mustang II was also affected by the new, stringent emissions and noise control legislation: all in all, it was underpowered and unexciting. The four-cylinder 2.3-litre entry-level engine, with just 100bhp, struggled badly and even the 2.8 V6 - with the engine later used in the Capri - barely managed to scramble from 0-60mph in 14 seconds. Iacocca ordered the Mustang II to be smaller and lighter than before, but costs still had to be kept down; it was therefore built on the same basic platform as the budget Pinto, albeit with a modified chassis and retaining its live axle rear suspension layout. Around a foot shorter than the original car, it nonetheless ended up heavier, despite the smaller engines, and the new front-biased weight distribution meant that the handling was nose-heavy, to say the least. Initial sales hardly reached the frenzy of early Mustang-mania, but at least the OPEC-triggered oil shortage meant that a number of buyers were prepared to sacrifice performance for economy.
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Things picked up a bit in '75, with the return of a V8: the 302-cu in block returned, though it was rendered pretty anaemic by emissions controls (just 134bhp) and was only available with an automatic transmission - acceleration from 0-60mph was a hardly inspiring 10.5 seconds. Arguably more interesting was the option of a Rallye suspension package with the V6 engine, with stiffer springs, wider anti-roll bars and adjustable shock absorbers, which at least improved the handling. Few buyers were attracted to the 'mpg' version, with a revised rear axle and gear ratios and standard catalytic converter: it may have returned up to 34mpg on the highway, good for the time, but it was deadly dull to drive. Catalytic converters became standard in 1976, though the manual gearbox was then offered in the V8; petrolheads remaining true to the Mustang cause resorted to a careful choice of options and the aftermarket tuners. Ford's own options, for a few years, were largely restricted to styling accessories, such as the Cobra II body kit - offered with four-cylinder models. 1978 brought the King Cobra Mustang II: the 302 V8, four-speed manual transmission, revised suspension, a Venturi carb and ritzy graphics: some 500 were built, and their 0-60 time of just over 11 seconds was marginally more respectable. A series of show cars prepared with Monroe, the shock absorber manufacturer, and finished with wild custom paint jobs helped keep some interest in the range until the all-new Mustang III debuted the following year.
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