Here's my take on the subject: While I agree that a V8 Mustang will not have the huge sales volume for a European consumer market (although there will be a few enthusiasts that will spend the cash...just like there are today who import and pay the huge taxes/import fees, etc.), but a 4 or 6 banger will sell all day long...assuming the price is in competition with other makes/models that are sold daily here.
I don't at all disagree with this. There will be a market for almost any car you put up for sale. And your idea about a 4- and 6-cyl alternative in certain countries is also a good one. Though I don't see the current mustang selling well, even if it was available in a smaller diaplacement version. The problem is that most europeans, whether you believe it or not (especially Germans!) are extremely nationalistic. You give the average German a choice between say a Golf/Scirocco R and what would likely be a similarly priced current gen mustang with a small motor (assuming such a thing existed for the sake of argument), and I bet a majority would choose the VW without even thinking twice. There is a supposed German citizen on this board who bought a GT and was mentioning how much crap he got for buying a Mustang. Like I said, admiring something and actually buying it are two very different things. There's a reason why VWs, which have up until now, have been almost exclusively deisgned for the EU market have not sold very well in the US. It's the same reason why the current mustang wouldn't sell well in the EU regardless of the powertrain.
I can tell you without hesitation that if Ford is smart they can sell Mustangs--and many of them. Germany's economy--today--is not in the toilet...not even close. While other European countries are having difficulties, it's the Germans and French who are bailing them all out.
With the current car, I don't believe this to be true, regardless regional wealth. However, if the question is if Ford could sell the Mustang nameplate outside of the US, the answer of course is, yes. Like VW has done with the current Jetta and Passat, Ford will need to produce a product that fits a little more closely to the expectations of a different market. I don't think with today's technology it's hard to due. But I think exterior styling could be the biggest issue.
Many of you seem to focus on one outlook and not the possibilities of having several options on the table. If the Mustang is only offered in Europe with a V8 then no, it won't sell well. If other options are available then it will.
With today's modular platforms it shouldn't be all that difficult to put in different drivetrain combinations for different markets. What will be an issue is developing a product with both a look and feel that will appeal to everyone. A more shapely and sleek body, with more attention to interior design will certainly appeal to more EU folks, but it may not appeal to a core audience of Americans who have a history of buying mustangs. Ford will have to walk a fine line with design and driving dynamics with the next mustang. It's not going to be the hardware, but the details which will determine how much of a national and international success the next mustang will be.