Magnitude of the Consequences
From the perspective of senior managers who made the decision, the magnitude of consequences introducing the Ford Pinto to the market is small. To support this point of view, Ford vice President firstly cited several statistical evidences. In 1975, only 12 of 848 deaths, which associated with passenger-car accidents in which fires also occurred, involved occupants of Pintos. And in 1976, the number of occupant fatalities in fire-associated passenger-car accidents in which Pintos were involved was 11 out of 942. According to these data, Pintos’ involvement rate in fire-associated fatality reports was only 1.17 percent, which means if one hundred car accidents happened in one year only one of them might involve Pintos. And based on the calculation of societal cost components for fatalities, per fatality is two hundred thousand dollars which is a tiny number of costs for Ford to afford comparing to re-designing the tooling system and delay the instruction. What’s more, even though several people might be hurt by the introduction of Pinto, millions more consumers will benefit from the fuel effective and low cost products and thousands of workers in US will get jobs. Therefore, the magnitude of consequences to launch Pinto is small, and the total benefits are much more than the sum of …show more content…
Each year in 1975 and 1976, only 11 to 12 accidents involves Pintos among 900 car accidents. In 1796, while Pintos accounted for about 2 percent of all cars in operation, their involvement rate in fire-associated fatality reports was only 1.17 percent. Additionally, the probability of gaining a profit is high in contrast to loss according to cost-benefit analysis. After weighing pros and cons, Ford launched Pinto