This next generation of Thunderbirds resulted from conditions outside the company’s control. Lee Iacocca was in charge at Ford, and he saw the Thunderbird as too big, expensive and inefficient. With the Corporate Average Fuel Economy (CAFÉ) looming, the 1977 car had to be smaller, more fuel efficient, and less costly. It was made ten inches shorter and 900 pounds lighter than its predecessor, and its sticker was thousands less. The base engine was now a 302 cid V8 with optional 351 and 400 cid engines available. It had a reworked suspension for better handling and front disc brakes for better stopping. Unfortunately, it also had quite a few tacky additions, including a lot of added trim that provided little in the way of substance. Even with the tacky additions, the public apparently loved this new, smaller Thunderbird—sales were huge at more than 318,000!
In 1978, Ford gave a pretty clear indication of what it thought “sports” meant. For its 75th anniversary, Ford produced a Diamond Jubilee Edition for an additional $10,000, but also added a Sports Décor Group. For $400, you got a blacked-out grille, tan roof, raised letters on the tires, cast spoke wheels and phony luggage straps on the trunk. Late in the model year, removable, glass T-Tops were added. Again, the Thunderbird set a new sales record for the model at 352,751. The only changes for ’79 were a two-barrel carburetor on the 302 V8, a bolder grille, and more chrome. Sales dropped for the first time for this model, but they were still at a very respectable 284,000.