Because it was deemed to cost too much, relative to the target price of the car, Iacocca negated the proposed mechanical reform. "Safety doesn't sell," was his motto. The Pinto was deemed acceptable for the roads because it was a 1971 model and new National Highway Traffic Safety Administration (NHTSA) regulations regarding vehicle safety that would have prevented the release of the Pinto were not passed until 1977.
The 'pros,' however, of avoiding lawsuits seem obvious in retrospect, but within the hothouse managerial atmosphere at Ford, the focus on increasing sales and the bottom line was nearly obsessive, as was meeting set benchmarks.
Feasibility of alternatives
What grabbed the public's attention about the Pinto, in addition to Ford's rigid actuarial calculations of how many lawsuits were likely to ensue per customer death, was the fact that the safety mechanism was so inexpensive and easy for Ford to install. The only reason not to include it, from a feasibility perspective, was because of the company's idea that cost and meeting Iacocca's inflexible deadlines were non-negotiable.
Decide on the valid alternative and make recommendations, agenda of corrective actions
Installing the $11 valve upon the Pinto's release would have prevented Ford from losing sales across the board. Ford's feeble protests that companies make cost-benefit analyses all the time regarding customer safety rang hollow, given the horrific nature of the Pinto crashes and the carnage (third-degree burns all over a young boy's body; the deaths of young girls) that subsequently ensued. The argument that actuarial predictions suggested that 'only 180' lives...
Ford Pinto -- Case Analysis On August 10, 1978 a group composed of three young women, two were eighteen and one was sixteen, were the subject of a rear end automobile accident by another vehicle while driving in a 1973 Ford Pinto (Epstein, 1980). The car was engulfed in flames due to an explosion in the gas tank of the car and the three young women lost their lives in a
Ethics The Ford Pinto case offers an ideal opportunity to apply utilitarian ethics to a real world situation. First, it is important to list the actors and stakeholders in this case. Lee Iacocca was the leader of the Ford Motor Company. He is credited with creating the inflexible parameters for the Pinto automobile as weighing no more than 2000 pounds and costing no more than $2,000. Therefore, the utilitarian analysis can
FORD Case Study Discussion & Executive Summary Objectives Identify ethical problems faced managers. Apply steps ethical moral decision-making address management issues. Use ethical perspectives make management decisions. Ford Pinto case study discussion & executive summary Managers must continually balance their own, personal sense of ethics with the need to render a company profitable. In the case of Ford, the pressure to create an affordable car resulted in the company making unethical decisions that
Ford Pinto What happened to the Ford Pinto? Ford Motor Company had intended to compete with other automobiles on the market that were smaller and used less gas. But something went terribly wrong along the way. This paper explores the details that led ultimately to the demise of the Ford Pinto -- and to the deaths and injuries of innocent consumers. Why was the Pinto developed in the first place? Ford Motor
Legally, forcing Ford to make costly payments to the families of the victims of its maleficent inaction was good for society as well as for the individuals who were harmed. Companies are less likely to make such criminally negligent risk/benefit calculations when they know the legal system will penalize the organization financially and legally. Only by increasing the hazardous potential of financial loss from acting immorally can the tort system
Unfortunately, many companies and industries have not learned from the mistakes of the Ford company; as this is an issue that continues to happen with a number of large companies. A prime example of an industry that continues to use a cost benefit analysis even when it involves human life is the airline industry. Many companies within the industry have known in the past that some parts of the
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