id do the heads & cam, but i would use a e303 instead, it is a fav of mine, & others around here. it will be better all around, & still have hp down low. id also get a gt40/cobra intake & 65mm throttle body, 24lb injectors & at least 70mm maf.
if the bottle tune is not right on the money, look out, caus the motor wont hold up.
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1988 Mustang GT, T-5
3.08's, No Smog Pump (Shorty Belt), Dumps At The End Of Stock H-Pipe, K&N Air Filter (Stock Air Box), Removed air silendcer), 198.9 rwhp @4200 (235 Motor!!), 285 lbs-ft @2900 (336 Motor!!!).
My Stang
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