I'm sure everyone knew at least one kid who's parent's gave them, or let them buy, high horsepower cars in high school. I remember wanting the early Camaro (67-69 only) as well as the Mustangs. I eventually bought an 80 Mercury Capri with a 4 cylinder engine. It was a nice looking car and ran okay for the time (mid to late 80's) Eventually I bought a circle track 2.3 L engine for it and put it in myself (well, a little help from Pepsi Bob ;-). Still nowhere what I have today, but fine for high school and college.
In those days, it wasn't hard to modify a stock Mustang or Camaro to gain some significant horsepower. That is if you bought a pre-1975 or were willing to put in a new motor. The late 80's brought back some muscle cars, but were still limited. Then the government introduced ODB computer controls. Actually, the required them in all new cars from 1996 and later. A number of cars had it before then, but it took a few years to figure out how to modify the computer. And boy can you modify the computer.
Why I am talking about history? Well, one of the main things you could do via a computer in these cars is to add more timing and lean out the fuel mixture, gaining more horsepower. All without physically changing anything. When I first heard about this, companies like Modular Powerhouse and others were providing 'flip chips' to change the program in the computer by moving a key switch between three positions: mileage, performance and valet. The ideas was that the computer would be programmed for more performance (assuming you had the right gas) in one mode and crippled in the 'valet' mode. I'm always worried about what the valet does when they take the car and I'd be more concerned if I had Corvette, Porsche etc.
In valet mode, the engine won't rev beyond 3000 RPM and the timing was such that it had less horsepower than an 1980's Chevette. Good chance your valet won't be doing donuts or burn outs while you are at dinner!
A number of other people changed the 'mileage' tune to 'daughter tune'. I know, I have two daughters and this is sexist, but the idea is to let the kid drive the car without worrying they'd wreck it and hurt themselves or someone else. Yes, I know teenage boys cause more accidents than girls, but that is what people called it. Here the tune wasn't as restrictive as the Valet, but it also wasn't a 300+ HP car for a 16 year old.
Well, Ford finally noticed that this made sense and in a number of 2010 cars are providing a 'teenager' key that limits the speed, RPMs and stereo volume. Yes, the computer even controls the stereo in these new cars. Neat idea AND covered by warranty.
I think for when they are learning to drive this is a good idea, or when they have a new girlfriend or boyfriend and are likely to show off ;-) But at some point you need to teach your kids to drive and trust they know what they are doing. Personally, with Meghan 2 years from her license I'm looking into a defensive driving class like this. I'll probably get a more gentle tune for the Mustang so she can drive it every once and a while (assuming the insurance isn't obscene.)
If you think this is a good idea, but don't want to buy a new car, any car built since 1996 can be modified by a 'tuner' to have this restricted performance. You'll need to load the tune before they drive, but it is an option.