The first generation of Ford Mustang was incredibly successful. Ford sold over 1 million vehicles in less than two years of production. Any American could buy a Mustang for a modest price of just $2,368. The base model was a hardtop with a six-cylinder engine. However, Ford advertising encouraged people to consider additional options and upgrades, which is why most people bought not the six-cylinder version but the V8. The six-cylinder engine models accounted only for about 27% of Mustang sales in 1964. The remaining 73% were the V8s. There was even a model with 271 horsepower introduced in late 1964. About 50% of the Mustangs that year were sold with automatic transmissions and another 20% of the buyers chose an upgrade from a regular three-speed manual transmission to a four-speed manual transmission.
Carroll Shelby was a Le Mans winner and the creator of Shelby roadsters. From 1965 to 1970, he produced a Shelby version of the Mustang. Fundamentally, the car was a race car slightly adapted for street usage. It had a very stiff suspension, fibreglass hood, loud exhaust and Spartan interior. Even with all these changes, Ford Motor Company chose to cover Shelby Mustangs with its own warranty. 1965 Shelby Mustang GT-350 didn’t even have a rear seat. Instead, there was a fibreglass floor cover that decreased the weight of the car even further and allowed the GT-350 to compete in races approved by the Sports Car Club of America as a two-seater.
In 1966, Shelby softened his approach a little. 1966 Shelby Mustangs were available with an automatic transmission, a variety of attractive colours, softer suspension, radio and back seats. Ford Motor Company wanted a Shelby car that was more appealing to the market than the 1965 Shelby models, which were extremely expensive and way too rough for the mass-market. This was the reason for the changes made in 1966 models.