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The XR-400 was a fully operational concept car.[1] A "sporty" youth-oriented convertible was built in 1962 by the Budd Company for evaluation by the American Motors Corporation (AMC).


The objective of this car was to entice AMC to expand into a new market segment with a low-cost Rambler-based "sports convertible."[2] The Budd Company was a long-time supplier of tooling, parts, and bodies to automakers. By enticing AMC with this concept, Budd’s already existing business with AMC would increase. It planned to supply bodies and major sub-assemblies for the production version of this new car. Budd estimated that the new model could be available for public sale by October 1963[3], six months ahead of the Ford Mustang.[4]


The XR-400 was built on a shortened two-door 1962 Ambassador chassis.[5] It was styled by Budd with a rather clean and uncluttered body giving little indication of its Rambler sedan origin. A double crease in the beltline suggested a family relationship to the contemporary styling of Rambler’s large-sized cars.

The proposed model was a true 2+2 (two front bucket seats plus limited use seats for two back passengers) convertible with a long hood and a short rear deck. The XR-400’s long wheelbase (108 inch, 2743 mm) and truncated overhangs gave it athletic proportions, while the top-up appearance suggested a close-coupled two-seater sports car. Classic sports car touches included a hood line that slopped lower than the front fenders, doors that had a dip in their top, and simulated scoops behind the front wheels.

Power for the XR-400 was supplied by a standard Ambassador 327 in³ (5.4 L) V8. The engine bay could accommodate any of AMC’s I6 or V8 engines. The transmission was an automatic (not typical of sports cars) controlled through a floor mounted shift lever. The interior used AMC’s front seats and many other hardware items. In classic sports car fashion, the driver had all controls and a full set of instruments (speedometer, tachometer, and gauges for fuel, water temperature, amperes, and oil pressure) mounted directly ahead of a highly regarded three-spoke wood-rimmed Nardi (brand) steering wheel.

Budd's pitch to AMC included pioneering a market "presently untapped by any other manufacturer" with a car so "unlike anything else on the road it would attract widespread attention, provide your dealers with both a new profit area and morale-builder, and offer unusual advertising and sales promotion opportunities."[6]


The press release stated that the concept shows how modifying Rambler Ambassadors results in:

"... a brand new type of car -- one designed specifically to take over a healthy segment of the new car market presently untapped by any American manufacturer...."[3]

Automotive press reports stated that such a new model could have appeared in AMC dealer showrooms at least six months before Ford's similar Mustang started the "pony car" market. Unfortunately, AMC turned down the idea. There were probably several reasons for this decision[7], including:

  • American Motors’ President George W. Romney, who cemented the company as a maker of compact cars, left the company in February 1962 to run for governor of Michigan.
  • His replacement, Roy Abernethy, began a strategy head-to-head competition with the Big Three automakers (General Motors, Ford, and Chrysler) across all major market segments.
  • The new model had very little interior room to compete successfully against other sporty compact cars such as the Chevrolet Corvair Monza and the Pontiac Tempest Le Mans.
  • American Motors was developing entirely new models for 1963 and this was a major capital drain. Entering a completely new market segment with an unproven car could be a costly mistake.
  • The company was itself working on a new compact fastback concept car called the Rambler Tarpon using the soon to be introduced third generation Rambler American platform.


The Budd Company kept the only prototype model, but later renamed it "XR-Budd" and used it for marketing purposes. The prototype was upgraded with chrome-reverse rims, but the original version had full wheel covers. The car is now at The Henry Ford Museum.

There are two final ironies to the XR-400 story.[3]

  • Budd tried to sell the idea to Ford first. In 1961 Budd combined a 1957 Thunderbird body with a 1961 Ford Falcon chassis to produce a sporty convertible. When Ford turned them down, Budd shifted focus to AMC. Ford, of course went on to base the Mustang on the Falcon chassis.[8]
  • In 1987 American Motors gave up its struggle to remain independent, and was bought out by Chrysler Corporation. Chrysler was headed by Lee Iacocca, who, while at Ford, was the man who pushed the Mustang into production. As Iacocca stated, in the car business, "you either lead, follow, or get out of the way."[9]