This paper presents a two-level product modeling method that supports Simulation-Based Design (SBD) of mechanical systems, primarily ground vehicles and heavy equipment, for preliminary and detailed design. A Computer-Aided Design (CAD) model combined with engineering parameters and mathematical equations that describe physical behavior of the mechanical system constitute its product model for SBD. For preliminary design, improvement of system performance, including dynamics and human factors, is the primary focus. A CAD model with reasonably accurate physical parameters, such as mass properties, is defined as the base definition of the product model. A parametric study can be conducted to search for design alternatives using dimension parameters created in the parameterized CAD model. Component designs are the primary focus in the detailed design stage. A detailed product model is evolved from that of the preliminary design, by refining geometric representation of mechanical components in CAD and expanding product assembly into parts and sub-assemblies for further engineering analysis. In the detailed design stage, a systematic design trade-off method is usually needed for design improvement. In both design stages, CAD and Computer-Aided Engineering (CAE) mappings that tie dimension parameters in the CAD model and physical parameters of simulation models facilitate the parametric study and design trade-off by quickly generating simulation models to simulate performance of the modified design. A High Mobility Multi-Purpose Wheeled Vehicle (HMMWV) is employed to illustrate and demonstrate the modeling method.