The Ford Pinto case study clearly presents an unethical and immoral practice that shows corporate greed for a positive bottom line is more important than the value of human life. Along with the issue of greed is the need to outdo the competition to be the best in the automobile industry. Together these issues cloud the judgment of Ford’s management. The use of cost-benefit analysis to determine if the flaw in Ford Pinto automobiles is worth the financial risk in comparison to the value of human life is unconscionable and indefensible.
Because of this cost-benefit analysis, Ford made a costly decision not only in terms of money but also human life, pain and suffering for victims and their families, and to its own reputation. Ford chose to pay for possible lawsuits in lieu of recalling and repairing the Ford Pinto. Many deaths and catastrophic injuries were the result of Ford’s unethical decision that resulted in dozens of lawsuits and also led to the three reckless homicide indictments against Ford Motor Company.
If Ford had the right business ethic and moral integrity to put consumer safety first, instead of profit and competition, there would have been no loss of life or financial suffering because there would not have been lawsuits. Dilemma Solution The solution to the dilemma relative to the Ford Pinto case is that the company should have taken appropriate action to ensure that the car was safe to operate. Lee Iacocca, along with Ford engineers, had an ethical and moral responsibility to ascertain the vehicle was safe to operate before rolling them off the factory floor (Birsch, 2001-2006).
The drive to make a profit overshadowed Ford’s concern for consumer safety. The company should have taken the initiative to make the appropriate safety alterations before allowing the car to go on the market. Knowing that the car was unsafe for public highway use left the Ford Motor Company open to civil lawsuits that could have been avoided (Birsch, 2001-2006). The actions by Lee Iacocca and the other executives were careless and in gross disregard for human safety and life.
Events relative to the Ford Pinto case demonstrate some of the ethical issues related to technology, skill, and safety. To manufacture a trendy but affordable small-sized vehicle in line with low operating costs, the company made a judgment call about the location and protection of the fuel tank (Birsch, 2001-2006). Installing a gas tank that was safer in addition to a more appropriate gas tank location was technologically feasible, as was installing an inexpensive buffer, but consumer affordability and style of the vehicle took precedence over safety.
The actions of the Ford engineers, inhibited by design and cost restriction as well as deadline pressure, exemplify engineering choices often made from business marketing strategies. The vehicle, designed to have a short rear-end, limited the engineers’ alternatives for fuel tank safety and location. As a result engineers placed the tank behind the rear axle instead of over the axle (Birsch, 2001-2006). Another example of a restraint on the engineers was management’s apparent mandate that the vehicle cost be no more than $2,000 and weigh no more than 2,000 pounds (Birsch, 2001-2006).
However, customer safety should have been paramount over company profits. The company also ignored other ethical and professional obligations of its engineers, the relations between different parts of organizations, ethical decision-making processes, and efficient government safety policies (Birsch, 2001-2006). External Social Pressure The Ford Motor Company’s production of the Pinto meant that there would be an American car that would be competitive to the smaller Japanese cars. This meant production had to be both inexpensive and rapid to keep up with public demand.
For this reason, there was initially very little external social pressure from the public resulting in the continued production of the Ford Pinto from 1971 to 1978. In addition, there was no government agency to regulate the Ford Motor Company’s rear-end impact standard of the Pinto. At the time, the National Highway Traffic Safety Administration had not implemented a rear-end impact standard. Therefore, the automobile manufacturer continued to produce the car year after year, despite the knowledge of the fiery results of its crash tests.
It was not until around 1976 that the car manufacturer first started receiving pressure from the public in the form of lawsuits. In the years between 1976 and 1977 there were 13 rear-end explosions. The Ford Motor Company initially had conducted their cost-benefit analysis and concluded that it would be less expensive to compensate consumers from lawsuits than to repair the problem with the fuel tank by adding a baffle as a buffer at a maximum cost of $11 per car.
Lawsuits brought against the Ford Motor Company, far exceeded the amount it cost to fix the defect. It was apparent that the automobile manufacturer had underestimated the cost of the lawsuits versus the cost to recall and fix the problem. Undoubtedly, the lawsuits would bring with it bad publicity and public disapproval. One would think that bad publicity and condemnation from former Ford executive Harley Copp and from consumer activist, Ralph Nader would appear to deter public demand for the car, but it did not.
The escalating lawsuits, the bad publicity, and the constant criticism of the Pinto only amounted to a little external social pressure. Public demand was still high for an inexpensive American car to compete with its Japanese rival. The Ford Pinto sales remained prominent in 1978 until the manufacturer recalled the car. Period Eye Despite the nearly 30 years that have passed in the Ford Pinto Case, period eye, does not change the way Ford, or another automobile manufacturer should have handled the defect.
Period eye is a way to examine an issue and question the way of seeing the past in comparison to a modern day point of view. The concept allows people to debate whether there have been any profound shifts in cultural vision or habits over time (Reed, 1995). Although the National Transportation Safety Administration did not have safety standards in 1971 for rear-end impact, Ford’s primary responsibility to consumers was not providing a small, economically priced fuel-efficient car, but to consumer safety.
The use of cost-benefit analysis was used by Ford in 1971 in determining if they would fix the Pinto. This analysis is still a major calculating factor for companies today even though the practice is unethical and immoral and should be made illegal when human life and safety is involved. Putting a price tag on a human life versus the cost of repairing each Pinto, at no more than $11 each, is unconscionable (De George, 2005). Ford should have recognized that human life and safety is a “prima facie moral rule” and it had a “perfect duty.
” Meaning everyone should see that its actions were clearly prescribed and forbidden (Trevino & Nelson, 2006). The Ford Pinto case also illustrates that the cost-benefit analysis is highly flawed and cost the Ford Motor Company $30 million more than its analysis estimated along with extensive damage to its worldwide reputation. Unfortunately, despite 30 years and hundreds of safety laws later, the auto industry has not seemed to change its culture of profit first as illustrated in the 2010 Toyota recall.
Lead stories on the business pages across the country, as recently as May 20, 2010, read “A top executive of Toyota sought to defend his company against criticism that it appears more focused on fighting lawsuits than on fixing so-called sudden acceleration in its car” (Trumbull, 2010). Conclusion The case of the Ford Pinto has shown an example of the highest cost of unethical behavior- that of innocent human life. When faced with the decision to either make safety or profit the primary focus, Ford Motor Company chose profit.
The disastrous results reflect the reckless and careless behavior so often associated with unethical choices. Because of the decision to pay for possible lawsuits instead of repairing the defect with the Pinto’s fuel tank, many lives were lost or severely injured, and the lawsuits amounted to much more than Ford anticipated in their cost-benefit analysis. Had Ford chose safety before profit, they would have made the most ethical decision while saving the lives and suffering of so many innocent people. References Birsch, D. (2001-2006). Ford Pinto Case. Encyclopedia of Science, Technology, and Ethics.
Macmillian Reference USA. Retrieved from http://www. bookrags. com/research/ford- pinto-case-este-0001_0002_0/ De George, R. (2005). Business Ethics. Upper Saddle River, NJ: Prentice Hall. Reed, C. (1995). The Period Eye. Art Journal , 91. Trevino, L. , & Nelson, K. (2006). Managing Business Ethics: Straight Talk About How To Do It Right. John Wiley & Sons. Trumbull, M. (2010, May 20). Toyota recall: Automaker focused more on damage control than fixes? Retrieved from The Christian Science Monitor: http://www. csmonitor. com/Money/2010/0520/Toyota-recall-Automaker-focused-more- on-damage-control-than-fixes