Really any plans for Tito ended in Feb 86 when he dropped the belt to Savage. A bit shocking given that Tito/Hammer headlined everywhere for like a year.
Tito wasn't a cartoon though, and was probably easy to overlook. And we can look back now and realize his promos peaked at mid.
He was "lucky" Zenk flaked out and Tito got another half a year of relevance, including a slew of main events. The moment Martel got hurt, Tito went back to doing nothing and was fucking around in the mid card. The Martel feud was a good boost, and they probably should have blew it off at WM 6. (Yes, they were booked for SSlam 90)
He had been in and out of the WWF since 1979(8?) and could be lumped in was the MANY guys who had their run during the expansion and were tossed back into the wild. The fact that Vince kept him around for so long shows they knew he was a good trooper and eventually wasn't afraid of laying down nightly.
It would be interesting to see if the Matador gimmick would have "saved" him had the switch happened a little sooner. Heck, even using Tito as Steamboat's partner in either 88 (after Martel's injury) or in 91 could have been a jolt for both men.
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I'm torn on the 3rd title for WWF. They had so much going on it doesn't scream out as a need to me. Dusty had a title fetish and JCP's 10 titles deluded more things than they helped get people over. The TV title was usually booked well, in very different ways. You had it for Dusty/Tully as another token in their blood feud (would the title have mattered either way?) and eventually it made it onto the workrate guys who were being set up for next level pushes.