Ford Mustang entered the market in 1964. Four important factors were responsible for its creation and success. These factors were having the right person in charge, the growing popularity of European and Japanese sports cars in the United States, the repeal of the racing ban, and smart market research by Ford Motor Company.
Lee Iacocca, the legendary automotive industry executive, joined Ford Motor Company in 1946. He first worked for the company in the capacity of an industrial engineer but soon discovered that his skill set and personality were better suited for marketing and sales goals. He became the vice president of Ford Motor Company by 1960 because of his brilliant marketing campaigns such as 56 for 56, a program that offered $56 installment payments for Ford vehicles produced in 1956.
Lacocca noticed that American veterans returning home after World War II appreciated small and sporty European cars such as MGs and Jaguars. He also noticed how public loved Ford Thunderbird, a two-seater car introduced in 1955.
In 1957, Ford Motor Company, General Motors and Chrysler Corporation agreed to suspend the factory support of motorsports to avoid having the US Congress introduce new safety rules for the US auto industry. Ford Motor Company honoured the agreement while Chevrolet and Pontiac didn’t and kept providing support to their racing engineering teams.
Because Ford lost its edge in racing, its cars started becoming unexciting and did not appeal to young buyers anymore. The first wave of post-war population was hitting the age of being able to drive and buy a car. They were educated and affluent. They wanted sexy and sporty cars, yet Ford was offering older models and promoting them as safe and reliable.
Laccoca noticed all this and gathered Ford’s most creative thinkers and members of the advertising agency that Ford worked with. After a lot of meetings and a lot of hard work, the Ford Mustang was born.