For 1979, an all new Mustang hit the dealerships. Larger and based on the Fox platform, the new Mustang deviated from the smaller compact Mustangs of the past. The interior was completely redone and could now comfortably seat four, even with the smaller back seat. The new Mustang also enjoyed a great deal of trunk space and a bigger engine bay for better serviceability. The 2.3 L four-cylinder from the earlier car was continued, but refined, in addition to a new turbocharged version rated at 132 hp (98 kW). However, the latter was dropped after one year, due to reliability issues. The Mustang II's 2.8 L Cologne V6, made by Ford of Europe, was continued only for a year. The low-reving 302 also returned, rated at 140 hp (104 kW) at 3200 rpm. Mustang was again chosen as pace car for duties in the Indianapolis 500. Ford commemorated the honor with an "Indy 500" pace car edition.
Ford's 3.3 L inline-six replaced the 2.8 L V6 for mid-1979, as supplies of the 2.8 were inadequate. The new 4.2 L V8 was the only V8 offered from 1980 to 1981. Basically a de-bored 302, the 4.2 L V8 had restrictive heads and managed to produce 120 hp (88 kW), the lowest power ever for a Mustang V8. In 1982, the Mustang was revived with the reintroduction of the Mustang GT; bringing more V8 power from the 302 in³ engine via new valves, a more aggressive cam, a larger 2-barrel carburetor, and a better breathing intake and exhaust system, rated at 157 hp (117 kW). With the 302, it was one of the quickest domestic cars in America.
1983–1986
The 3.8 L Essex V6 replaced the 3.3 L I6, as the 3.3 L engine had little demand and was dropped after 1982. Ford added a convertible to the Mustang line in 1983 in response to the 1982 Chrysler convertibles. In 1983, the Mustang GT received a 4-barrel carburetor and a new intake manifold, bringing power to 175 hp (130 kW). The rare SVO Mustang appeared for 1984, with a far more powerful and refined 2.3 L turbocharged inline-4. It also sported handling and braking abilities that would humble a Mustang GT. However, the steep price tag put off most potential buyers. In 1985, the Mustang GT got the exclusive 302 in³ (named 5.0 L High Output) engine with new E5 cylinder heads, a Holley 4-barrel carburetor, a new and more aggressive roller camshaft (only in models with the manual transmission), a new intake manifold, less restrictive exhaust manifolds, and a pseudo dual exhaust which brought more power to a conservatively rated 210 hp (157 kW) engine. This combination was short-lived however, because in 1986, Ford released the first multiport fuel-injected 302 in³ V8, rated at 200 hp (150 kW). With high swirl E6 heads, the early 5.0 (302 in³) High Output EFI intake possessed higher compression and dual exhausts. Also, in 1985 was the 5.0 HO EFI engine which used the early CFI fuel injection; this was often equipped with the AOD automatic transmission rather than the C4. It made for a motor with an abundance of throttle response and low rpm torque, in addition to a very broad powerband that would sign off suddenly at just 5000 rpm.
1987–1993
1987-1993 Mustang
In 1987, the Mustang received its first redesign in eight years; incorporating both interior and exterior changes. The exterior design was reminiscent of the earlier SVO and gave the car more of an "Aero" look, in keeping with Ford's overall styling direction. This particular Mustang represents the longest run on any platform and the popularity of the Mustang remained high due to its low cost and high performance. The 302 in³ or "5.0" Mustangs, became popular with the aftermarket performance industry. The V6 option was discontinued while the 2.3 L four-cylinder gained fuel injection, leaving only the 2.3 L four cylinder and the 302 in³ V8. Under the newly established Ford SVT division, the Ford Mustang SVT Cobra was offered with the 302 in³ V8 that produced 235 hp (175 kW) and 280 ft•lbf (380 N•m) of torque.
For 1987, the Mustang received E7 heads and a more capable intake manifold. Power ratings jumped to 225 hp (168 kW) and 300 ft•lbf of torque. In 1989, the Mustang's speed density air system was replaced with a mass air system (1988 Mustangs sold in California also had the MAF system). This change slightly reduced factory horsepower, but it made Mustangs much easier to modify. With the mass air system, changes made to the intake, engine, and exhaust system would be recognized and compensated for by the ECU, resulting in a correct air/fuel ratio and optimum power. Ford's only gesture at a 25th Anniversary Mustang was small, a passenger-side dashboard emblem with galloping-horse logo affixed to all models built between March 27, 1989, and the end of model-year 1990.
In 1993, Ford switched to cast hypereutectic pistons for all 302 in³ engines and also re-rated the 5.0 GT at 205 hp (153 kW) and 275 ft•lbf of torque. This estimate was more accurate because the previous power ratings were made before the addition of the mass air flow system, a minor revision in the cam, and other various changes. A new Cobra model was introduced with more subdued styling than the GT. The Cobra used Ford's new GT-40 high performance engine equipment, which was rated at a very conservative 235 hp (175 kW) and 280 ft•lbf of torque, that could send a Mustang through the 1/4 mile in 14.5 seconds at just under 100 mph (160 km/h). A Cobra R model was also produced in 1993 that used the same engine as the regular Cobra. It featured larger brakes, Koni shocks and struts, an engine oil cooler, a power steering cooler, and a factory rear seat delete. Since the Cobra R was more race oriented, creature comforts such as air conditioning and a stereo system were not included.