Not much changed for the Cougar in its second year. The addition of federally mandated side marker lights was the major change. But the biggest changes were under the hood and performance-wise for the XR-7 model. Three new engines were added to the option list this year?the 230 hp (172 kW) 302 in? 4-barrel V8; the 335 hp (250 kW) 428 in? 4-barrel V8; and the 390 hp (291 kW) 427 in? 4-barrel V8. Mercury was serious about the Cougar being the performance icon for Mercury. The XR-7G named for Mercury road racer Dan Gurney came with all sorts of performance add-ons including a hood scoop Lucas fog lamps and hood pins. Engine selection was limited only to the 302 390 and the 428 V8. The mid-year 7.0 L GT-E package was available on both the standard and XR-7 Cougars and came with the 427 V8. The 428 Cobra Jet Ram Air was available in limited numbers on the GT-E towards the end of the model year. Conservatively rated at 335 hp (250 kW) the 428 Cobra Jet could produce much more (306 kW) from the factory.
