The 1965–1966 cars were the smallest and lightest of the GT 350 models. These cars are often called "Cobras", which was the Ford-powered AC-based two-seat sports car also produced by Shelby American during the same period. Both models use the Cobra emblem, similar paint scheme, and the optional "Cobra" valve covers on many GT350Hs that were part of a marketing tie-in by Shelby, as well as one of his iconic symbols. All 1965–66 cars featured the K-Code 271 hp (202 kW; 275 PS) 289 cu in (4.7 L), modified to produce 306 hp (228 kW; 310 PS). Marketing literature referred to this engine as the "Cobra hi-riser" due to its high-riser intake manifold. Beginning as a stock Mustang with a 4-speed manual and 9" live rear axle, the cars were shipped to Shelby American, where they received the high-riser manifolds, Tri-Y headers, and were given larger Ford Galaxie rear drum brakes with metallic-linings and Kelsey-Hayes front disc brakes.
The 1965 G.T. 350 was not built for comfort or ease of driving. There were 34 "G.T. 350R" race-spec cars were built specifically for competition use under SCCA rules, and the model was the B-Production champion for three straight years. The 1966 G.T. 350 had featured more comfort of casual drivers that included rear seats, optional colors, and an optional automatic transmission. This trend for additional features continued in following years, with the cars becoming progressively larger, heavier, and more comfortable, while losing much of their competitiveness in the process. The 1969 G.T. 350s and 500s were largely styling modifications to a stock Mustang. By 1969 Carroll Shelby was no longer involved in the Shelby GT program, and the design was done in-house by Ford.
The 1965 and 1966 G.T. 350s were delivered from Ford's San Jose assembly plant in body in white form for modification by Carroll Shelby's operation, originally in Venice Beach and later at Los Angeles International Airport. San Jose cars carried an "R" in the Ford VIN denoting that facility. The only year that Shelby Mustangs from the 1960s came from another plant was 1968, where they came from New Jersey, "T" in the VIN, and were modified by A.O. Smith.
Shelby struck a deal with the Hertz Corporation to produce a special line of G.T. 350s for rent that, after their rental-car lives were finished, were returned to Ford, refurbished, and sold to the public as "GT 350-H" models. Most Hertz cars featured gold LeMans stripes and rocker panel stripes, although a few were white with blue stripes. The first 85 Hertz cars were available with four-speed manual transmissions and Hertz advertised them as "Rent-a-Racer" cars. During rental, these cars were sometimes used as production class cars at SCCA events, and were rumored to have been returned to Hertz with evidence of roll bars being welded in. Hertz ordered the last 800 models with black paint, gold stripes and black interior, as well as automatic transmissions.
When the Hertz cars were returned to Ford to be prepared for sale to the public, the high-performance parts were often "lost" (presumably at the manufacturer) before final sale.
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Source: Wikipedia (original)