Carroll Shelby shoe-horned the big-block Ford V8 engine into the Mustang to create the 355 bhp GT500, which offered serious hot-rod performance in a luxury package. Ford entered the 1967 model year with many newly restyled models, and one totally rethought car that took up a new position in the marketplace. That particular car would be the Thunderbird, which moved from the luxury/sport/personal car arena to the more upmarket luxury/personal car category.
What this meant in terms of styling was added bulk and weight, less crispness of line and more rounded edges. What it meant in terms of performance was the same power moving more car. What it meant for the model lineup was the addition of a 4-Door Sedan model, and the dropping of the Convertible. Ford's marketing research department seemed at first to be right on, as sales of the Thunderbird increased over the 1966 models. As time went on, though, sales would slide annually, until the new 2-Door model was introduced in 1972. No matter what the eventual outcome, for now Ford had what looked to be a successful marketing move with one of its more popular models.
The full-size Ford models were totally redesigned once again, this time with more rounded lines that looked sleeker and more elegant, while still carrying traditional Ford lines. Most 2-Door models continued to carry a fastback roofline. One powertrain choice was added to the line: the 428 CID V8 engine, available in all models. The only model changes were the addition of an LTD 4-Door Sedan and the renaming of the Galaxie 500 XL line as just the XL series.
The highly successful Mustang pony car underwent its first styling update since its introduction in April of 1964. The restyling continued the successful Mustang look but appeared a bit more muscular, which it was with a new 390 CID V8 engine option available. The 390 CID V8 put out 320 horsepower and made the Mustang a top performer among its class of cars. The mid-size Fairlane and compact Falcon carried on in 1967 with relatively minor changes. The Fairlane 500 GT was now simply the Fairlane GT, and the Falcon Squire wagon was replaced by the Falcon Futura wagon.