Intended as a world car, it replaced the Ford Sierra in Europe, the Ford Telstar in a large portion of Asia and other markets, while the Contour and Mercury Mystique replaced the Ford Tempo and Mercury Topaz in North America. Unlike the Sierra, the Mondeo is front-wheel drive in its most common form, with a rarer four-wheel drive version available on the Mk1 car only. Instigated in 1986, the design of the car cost Ford US$6 billion. It was one of the most expensive new car programs ever. The Mondeo was significant as its design and marketing was shared between Ford USA in Dearborn, and Ford of Europe. Its codename while under development reflected thus: CDW27 signified that it straddled the C & D size classes and was a "World Car".
The car was launched in the midst of turbulent times at Ford of Europe, when the division was haemorrhaging hundreds of millions of dollars, and had gained a reputation in the motoring press for selling products which had been designed by accountants rather than engineers. The fourth generation Escort and Orion of 1990 was the zenith of this cost-cutting/high price philosophy which was by then beginning to backfire on Ford, with the cars being slated for their sub standard ride and handling, though a facelift in 1992 had seen things improve a little. The Sierra had sold well, but not as well as the all-conquering Cortina before it, and in Britain, it had been overtaken in the sales charts by the newer Vauxhall Cavalier. Previously loyal customers were already turning to rival products and by the time of the Mondeo's launch, the future of Europe as a Ford manufacturing base was hanging in the balance. The new car had to be good, and it had to sell.
Despite being billed as a world car, the only external items the Mondeo shared with the Contour were the windscreen, front windows, front mirrors and door handles. Even the interior was slightly different. The CDW27 project turned out not to be a true world car in the sense that the original Ford Focus was; one design for the world.