The 1974 Mustang marked the beginning of the "Mustang II" generation. These smaller cars had weaker engines due to the fuel crisis, and proved to be a  hit with buyers. Even with slower cars and higher prices, sales nearly tripled the 1973 numbers, and the Mustang II was named Motor Trend's Car of the Year. Mustang IIs featured rack-and-pinion steering, which made driving easier and more comfortable. The switch to rack-and-pinion became a popular modification for first-generation owners.

Convertible Mustangs weren't offered in 1974 due to federal safety regulations, and the Ghia replaced the Grandé as the luxury Mustang.

For more info on Mustang IIs, check out MustangII.net.