Ford Pinto Executive Summary Your Name University of Phoenix MGT/216 Teacher Date Ford Pinto Executive Summary The Ford Pinto case is a classic example of ethics versus money. Ford decided to make a decision that was unethical in order to save time and money. The questions that come about when determining how unethical it all was are: What solutions would be recommended to make it better? How did external social pressures influence the decisions? Through the period eye would the decision made have been the same today as in 1971? Recommended Solutions
Fords argument to the government was, “It would be cheaper in the long run to just let their customer’s burn! ” How can this even be a dilemma or a problem? If that statement could be made, the vehicle is not the problem, the person in charge is. I have learned that in my attempts to save one dollar, in most cases the result is losing more. Although the text stated that Ford Pinto lost more than 50 million dollars in lawsuits and bad publicity, other text found on Engineering. com and Time. com states that Ford saved money by not correcting the problems. A summary table from Engineering. om states: Summary Table BENEFITS Savings: 180 burn deaths, 180 serious burn injuries, 2,100 burned vehicles. Unit Cost: $200,000 per death, $67,000 per injury, $700 per vehicle. Total Benefit: 180 X ($200,000) + 180 X ($67,000) + $2,100 X ($700) = $49. 5 million. COSTS Sales: 11 million cars, 1. 5 million light trucks. Unit Cost: $11 per car, $11 per truck. Total Cost: 11,000,000 X ($11) + 1,500,000 X ($11) = $137 million. Time. com, 2007: quoted a Ford Pinto memo, which ruthlessly calculates the cost of reinforcing the rear end ($121 million) versus the potential payout to victims ($50 million).
The Pinto Ford, I believe went wrong from conception. I would not have let the car be designed and produced in 25 months instead of the normal 43 months, unless it could be done properly. With the short production time the Pinto was not tested for rear-end impact until after it was produced. I would rather the car go through vigorous testing to cut down on some of the cost-benefit analysis that weighed the cost of adding the baffle against the estimated cost of lawsuits. As a cost-efficient decision there would be a no question choice of not adding the baffle.
As a moral decision there would be a dilemma. When I discovered that the gas tank was unsafe, I would have pictured my family riding in the death trap and all of the horrible conclusions that could arise from the gas tank rupturing. I simply would have put human life and safety before profit. I would choose to correct and strengthen the design. I also would have went with the pre-production idea of using the Ford Capri gas tank, which rides over the axle and differential housing, (Engineering. com). External Social Pressures The Ford Pinto case created quite an impact in society.
Whether or not the product was safe and ready to sell without proper construction or not considered in the many flaws of the product formed a dilemma that was sadly seen after the product was sold to consumers. The Ford Company knew that the product was not safe, but went ahead with making the vehicle. This put the Ford Company in a dilemma that could have been avoided if they had done the proper research before putting the car on the market. The solution would have been simple: wait the proper amount of time, establish a quality low cost automobile, and provide the much needed baffle.
Had this vehicle been properly fabricated there would have been no impact to the consumers and we would not have been thinking of the “what if” factors. It would have been simply a much needed economical car. However, this was not the case and even 50 plus years later we are still debating it. The external pressure that was most important was from the people. The people that lost their lives are what made us think of the solution. No amount of money can be put on a person’s life. The fact is that most company’s want to launch any product that they believe will make them the most profit and unfortunately this time the product was a failure.
The family’s of the victims, the victims themselves, and society took a step back after seeing what could have been avoided by installing a simple product. Although the Ford Pinto case happened so long ago, there are still thoughts of how it could have avoided. The solution was simple but not considered early enough to change in time. Now, we can only learn from the mistakes and take into account the effects of such decisions. Had this vehicle been made with the baffle there would have been no issue with the product. The people who bought the car would have said it was one of the smartest purchases.
Nonetheless, it is too late for regrets and we can only step forward in the future to make sure something like this does not happen again. Period Eye Ford made unethical decisions in pushing the 1971 Pinto through production without regards for safety. Drivers and passengers were burned and or killed when the 1971 Pintos were involved in rear-end collisions (Newton & Ford, 2008). Ford hid crash results from the government and posed questions to make more paperwork, which postponed the government in implementing regulations. As a result, Ford was able to produce even more Pintos.
In addition, Ford handled civil lawsuits outside of court to prevent more bad publicity and court fees. Ford made unethical decisions in 1971 and the decisions are viewed as unethical today. Using a period eye, today’s consumers view Ford’s decisions as unethical. Lee Iacocca, from Ford, stated, “… safety was not a priority, because ‘safety doesn’t sell’” (Helms & Hutchins, 1992, p. 39). At that time it was true, safety didn’t sell. There were not as many rules and regulations for manufacturers put in place as there are today. In our society today, safety does sell.
Products are geared with safety, features or mixtures, for adults, children, animals, and the environment. The manufacturing processes of such products are highly regulated. The products must be thoroughly inspected and approved by quality representatives from the companies that produce them and in some product lines government agencies must audit the products. In today’s market, organizations that want to last hold customer satisfaction in high regard. When mistakes are made in production, recalls are common. Today’s society is forgiving to companies that try to handle their operations ethically.
Recalling products at the first sign of failure or as a precautionary measure is a sign of good faith. Companies that operate at that level earn loyal customers. In 1971, customer loyalty was not part of most strategic business plans and obviously not at Ford. At that time producing products that were mediocre in quality at a low cost was acceptable for most companies. Ford was becoming desperate under pressure from foreign competitors. They tried to lean out their manufacturing process without the proper business tools in place. Most manufacturers today operate under lean concepts.
They aim to eliminate wastes in their processes and produce high quality parts at faster production rates. The only difference is today’s workforce is highly trained and the methodologies that are utilized are highly effective. Steps in the manufacturing processes do not get skipped or overlooked for the sake of saving time. Families would have been saved for $5. 08 per vehicle to enhance the gas tank from exploding. Ford had an ethical obligation to provide safety for the consumers when Ford found out about the gas tank defect. Ford gave an excuse when presented with the injuries and tragedies.
The company felt that saving money on the 1971 Pinto and competing with foreign manufacturers for small cars was worth the causes (Helms & Hutchins, 1992). While they felt correct in their decision, the Pinto was later recalled to enhance the design to be safer (Newton & Ford, 2008). Ford was faced with losing money and strict regulations which changed their mind about implementing the fix. Ford should have recalled the Pintos and enhanced the gas tank much earlier when faced with the facts. Conclusion Though Ford made a poor decision that harmed many people, there are new laws that prevent those decisions from even being a problem today.
The recommend solution is to make the effort to protect people instead of keep costs down and put the needed part on. External social pressures influenced the decision because people were more concerned with low costs than safety and this lead to preventable deaths. Through the period eye it was discovered that the decision today would not be the same as in 1971. Today there are many safety laws that car companies must follow in order to get vehicles out to customers. Through all of this research it shows that ethics are more important than money, as it may save a life. References Helms, M. M. , & Hutchins, B. A. (1992).
Poor quality products: Is their production unethical? Management Decision, 30(5), 35-46. Retrieved on June 6, 2010, from ProQuest database. Newton, L. H. , & Ford, M. M. (2008). Taking sides: Clashing views in business ethics and society. (10th ed. ). Boston, MA: McGraw-Hill. Time. (2007). Times. com. Retrieved from: http://www. time. com/time/specials/2007/article/0,28804,1658545_1658498_1657866,00. html#ixzz0pl1hC0By Engineering. com. (2010). Engineering. com the engineer’s ultimate resource. Retrieved from: http://www. engineering. com/Library/ArticlesPage/tabid/85/articleType/ArticleView/articleId/166/Ford-Pinto. aspx