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In other words, a vacuum modulator "modulates" the transmission's shift points to engine load rather than just plain vehicle speed. See All 8 Photos A vacuum modulator references engine vacuum to ...
The idea of regulating vacuum to an automatic transmission's vacuum modulator is nothing new. Racer's have manually adjusted vacuum by means of a needle valve for years.
First, some history about Mustang transmission operation. Your Mustang's original C4 transmission has two shift control systems—the vacuum modulator (throttle valve) and a kick-down system.
Ford's Automatic Overdrive (AOD) transmission arrived in 1980 in full-size Fords, ... Where the C4 differs is its two means of upshift/downshift modulation-vacuum modulator and the kick-down linkage.