See, I'm puzzled. While there might be a brand spanking new 2008 Mustang on a car lot leaves me to believe it probably was a dealer's demo car. Why wouldn't the dealer know what that switch is for....I mean the car is said to be new so they should have all the paper work on it.
If he tells you it is an option he is full of crap. There is no such option like it, that comes from the factory. I think your dealer is pulling your leg.
I would definitely do a CarFax on it soon!

 

My car just blew up! I guess it was self destruction button! Thanks for the help!

 

Just found previous owner.

 

Well, we haven't been much help. ;(

Even though it was new when you bought it, it could be a demo car and some dealer put a remote engine kill device on it, so people can't steal it while doing a test drive. They then took everything off but forgot that particular part maybe.
How many miles were on the car when you bought it?

 

Too funny!

 

OK....come clean or you will be known as a Troll here on MF.

 

Thats a dealer installed shift light.
Check the options codes for a G7B
on the window sticker.
You have a very few ordered option
and a park it until it becomes valuable.

 

Why don't you call the dealer?

 

Could be a aftermarket alarm. The one in my cobra says ford right on it. When I needed to order a part for it I was told it was made by code alarm. They had no info on it and was told by the dealer this was installed and sold by ford but it was still aftermarket. Of course this still makes no sense to me. But this could be one of those deals.

 

Yeah my 07 has a very similar device in the same location. Button on the back, red flashing light on the front. It was my "ford aftermarket alarm" which was on the car when I bought it certified used from the dealer last summer. It worked fine untill some dumb *** in their service department screwed around with it while i had the car in for some work. Now it is in vallet mode and no one can figure out how to get it back into service. Apparently there is no manuall for this product that anyone can find either.

Hope yours works better than mine.