Examples of Ethical Issues
Operations
The Ford-Firestone Case
1. The Recall
In July 1998, Sam Boyden from State Farm Insurance received a call from a claims adjuster inquiring about Firestone tread separation. Sam began to research this issue and he found that there were 20 more such cases going back to 1992. All 21 cases involved Firestone ATX tires and 14 of them involved the Ford Explorer. He then sent an unsolicited e-mail to the National Highway Traffic Safety Administration (NHTSA) describing the 21 Firestone cases. In return, The NHTSA thanked him but did not follow up on the complaint. Sam Boyden proceeded to track the problem and during 1999 noticed another 30 such cases. He continued passing on the information to the NHTSA. In February 2000, Houston’s KHOU TV station aired a segment on tread separation. The station's report on tire problems prompted several dozen people in Texas to report similar trouble to regulators. Immediately thereafter, the NHTSA began studying the problem of Firestone tires. In May 2000, after accumulating 90 complaints involving four deaths, the agency opened a formal investigation. The investigation encompassed all 47 million AT, ATX and Wilderness tires made by Firestone over the last decade (1990-2000). By the beginning of August 2000, the NHTSA had recorded 68 fatalities in rollovers of Ford Explorer SUVs caused by sudden tread separation of Firestone tires. All except two dozen of the complaints came in year 2000, even though the Explorer had been on sale since 1990 and a handful of lawsuits citing tire failures were filed as early as 1993. By August 16, 2000, the government data included public complaints of 52 deaths in Explorers that rolled over after Firestone tires failed, and five more deaths in Explorers for which the complaints did not mention whether rollovers occurred. By September 19, there were 2,200 complaints involving 103 deaths and more than 400 injuriesiii. On August 9, 2000, Bridgestone-Firestone announced a recall of 6.5 million
The Ford-Firestone Case
1. The Recall
In July 1998, Sam Boyden from State Farm Insurance received a call from a claims adjuster inquiring about Firestone tread separation. Sam began to research this issue and he found that there were 20 more such cases going back to 1992. All 21 cases involved Firestone ATX tires and 14 of them involved the Ford Explorer. He then sent an unsolicited e-mail to the National Highway Traffic Safety Administration (NHTSA) describing the 21 Firestone cases. In return, The NHTSA thanked him but did not follow up on the complaint. Sam Boyden proceeded to track the problem and during 1999 noticed another 30 such cases. He continued passing on the information to the NHTSA. In February 2000, Houston’s KHOU TV station aired a segment on tread separation. The station's report on tire problems prompted several dozen people in Texas to report similar trouble to regulators. Immediately thereafter, the NHTSA began studying the problem of Firestone tires. In May 2000, after accumulating 90 complaints involving four deaths, the agency opened a formal investigation. The investigation encompassed all 47 million AT, ATX and Wilderness tires made by Firestone over the last decade (1990-2000). By the beginning of August 2000, the NHTSA had recorded 68 fatalities in rollovers of Ford Explorer SUVs caused by sudden tread separation of Firestone tires. All except two dozen of the complaints came in year 2000, even though the Explorer had been on sale since 1990 and a handful of lawsuits citing tire failures were filed as early as 1993. By August 16, 2000, the government data included public complaints of 52 deaths in Explorers that rolled over after Firestone tires failed, and five more deaths in Explorers for which the complaints did not mention whether rollovers occurred. By September 19, there were 2,200 complaints involving 103 deaths and more than 400 injuriesiii. On August 9, 2000, Bridgestone-Firestone announced a recall of 6.5 million