Ford Pinto: How Much Is A Life Worth In Dollars?
Case Analysis: Ford Pinto
Carlandra Moss
Excelsior College
November 2, 2014
How much is a life worth in dollars? Imaginably a couple of million? In the 1970s Ford Motor Company idea of life was worth about $200,000 dollars. In the article, Pinto Madness by Mark Dowie, Ford Motor Company argued that it would be too expensive to fix a crash-induced fuel leak in the Pinto Car model. Ford was definitely facing a serious moral obligation; the moral thing to do is to face the consequences and to act in ways that will maximize the happiness or the good that will result from an action. This case analysis will define that happiness, good, and results that Ford decided was conducive in rectifying the burning Pinto syndrome. …show more content…
Stakeholder analysis. Ford Motor Company began to make sense of it all by building a cost-benefit table. This table was buried in a seven-page company memorandum entitled "Fatalities Associated with Crash-Induced Fuel Leakage and Fires" (Dowie, 1977). The memo argues that there is no financial benefit in complying with proposed safety standards that would admittedly result in fewer auto fires, fewer burn deaths and fewer burn injuries (Dowie, 1977, p. 2). The cost-benefit analysis coldly calculated the expected benefits of repairing the Pinto 's defective fuel system in terms of lives, injury, and property saved, and compared them to the costs of design modifications. In lament terms, It would be cheaper, by a factor of three to one, to pay off victims and their families than to make an $11 fix in each car (Bonamici, K, 2005).
Analysis based on ethical theories. Automobile lawsuits date as far back as the early 20th century when automobiles were first placed on the market. In MacPherson v. Buick Motor Co., the court ruled in favor of a plaintiff when the wooden spokes of a 1920 Buick Runabout 's wheel crumbled, causing the car to collapse and eject the plaintiff. Judge Benjamin Cardozo explained in his ruling that, "If the nature of a thing is such that it is reasonably certain to place life and limb in peril when negligently made, it is then a thing of danger. Its nature gives warning of the consequences to be expected. If to the element of danger there is added knowledge that the thing will be used by persons other than the purchaser, and used without new tests, then, irrespective of contract, the manufacturer of this thing of danger is under a duty to make it carefully" (Ezroj, 2014). It seems that Ford Motor Company mindset, moral and ethical thinking were on the lines of, and very similar to Judge Cardozo’s explanation. In the mid-1960s, a period marked by challenging accepted cultural norms, members of the public began to challenge the widespread use of the automobile with what were believed to be its inherent risks. Consumer advocates alerted the public to manufacturers ' lack of interest in incorporating safety features. One such consumer advocate, Ralph Nader, published his book "Unsafe at Any Speed" in 1965. Manufacturing a product and sticking a sign that tells you enter at your own risk seemed to be the unethical mindset present.
Nonetheless, In the early 1970s, Dennis Gioia, a newly hired recall coordinator at Ford, heard scattered tales that the company 's popular new compact, the Pinto, "lit up" when hit in a rear-end collision.
After several attempts and gathering enough evidence Gioia brought the problem before the recall committee. The evidence insisted that during preproduction crash tests, Ford leaders learned, eight of 11 Pintos had "suffered potentially catastrophic gas tank ruptures" on impact. The fuel tanks of the three other cars had survived only because they 'd been shielded from a set of studs that did the puncturing (Bonamici, K, 2005). With Ford continuing to ignore or make repairs, more and more people were dying after being rear-ended in these cars. One example happened in Elkhart, Indiana during the fall of 1978, where three teenage girls died when their Pinto, equipped with an allegedly faulty gas tank system, burst into flames. This significant tragedy was intensified when it came to light that the accident was foreseeable. By the date of the accident, the internal cost-benefit analysis prepared by Ford employees had been made public. The cost-benefit analysis coldly calculated the expected benefits of repairing the Pinto 's defective fuel system in terms of lives, injury, and property saved, and compared them to the costs of design modifications. The analysis revealed that, although Ford executives knew that the placement of the tank on the Pinto could cause gas leakage …show more content…
in the case of a rear-end accident, they chose not to adopt a safer design because it would have added to the cost and weight of the vehicle. In short, Ford was caught putting concern for profits ahead of safety. Conclusion and recommendations.
Ford discontinued the Pinto in 1980 after a costly recall, but the blow to trust would prove more lasting. Consumer activists would now act as safety watchdogs. Competitive advantage is not to just present a product for consumers to purchase, but to gain trust and establish a relationship where they will continue to be loyal. Ford Motor Company was not mindful of this, and when a California jury awarded a Pinto victim a then unheard-of $125 million (later reduced to $3.5 million) for pain and suffering, it roused class-action lawyers everywhere (Bonamici, K, 2005). The results could and should have been different. Ford’s President, Lee Iacocca displayed a lack of mindfulness which inadvertently lapsed his judgment. Gaining a competitive advantage by producing a vehicle under the recommended production guidelines was undisciplined and negligent. In 1966, the National Academy of Sciences published "Accidental Death and Disability - The Neglected Disease of Modern Society," treated automobile accidents as an epidemic, and provided further scientific data supporting the risks associated with driving. The report explained that in 1965, automobile accidents and other accidental injuries killed 107,000 people, temporarily disabled over 10 million, and permanently impaired 400,000 American citizens at a cost of approximately $ 18 billion (Ezroj, 2014). According to the report, "this neglected epidemic of modern society was the nation 's
most important environmental health problem" (Bennett, 1990, Sec. III). Good business sense is quality over quantity. Had Iacocca sat back and thought about what the ultimate end might be, he may have made decisions based on more of immediate concerns—like safety.
References
Bennet, S. (1990, June 01). Developments in the Movement Against Corporate Crime.
Corporate Crime under attack: the Ford Pinto Case and Beyond. New York
University Law Review, 65, p. 971
Bonamici, K. (2005, June 27). 1972: Ford decides to let the Pinto explode. Fortune.
151(13), p. 77-80, Retrieved from www.eds.b.ebscohost.comvlib.excelsior.edu
Dowie, M. (1977, September/October). Pinto Madness. Mother Jones.
Ezroj, A. (2014, January 01). Product Liability After Unintended Acceleration: How
Automotive Litigation Has Evolved. Loyola Consumer Review, 26, p. 470
Carlandra Moss
Excelsior College
November 2, 2014
How much is a life worth in dollars? Imaginably a couple of million? In the 1970s Ford Motor Company idea of life was worth about $200,000 dollars. In the article, Pinto Madness by Mark Dowie, Ford Motor Company argued that it would be too expensive to fix a crash-induced fuel leak in the Pinto Car model. Ford was definitely facing a serious moral obligation; the moral thing to do is to face the consequences and to act in ways that will maximize the happiness or the good that will result from an action. This case analysis will define that happiness, good, and results that Ford decided was conducive in rectifying the burning Pinto syndrome. …show more content…
Stakeholder analysis. Ford Motor Company began to make sense of it all by building a cost-benefit table. This table was buried in a seven-page company memorandum entitled "Fatalities Associated with Crash-Induced Fuel Leakage and Fires" (Dowie, 1977). The memo argues that there is no financial benefit in complying with proposed safety standards that would admittedly result in fewer auto fires, fewer burn deaths and fewer burn injuries (Dowie, 1977, p. 2). The cost-benefit analysis coldly calculated the expected benefits of repairing the Pinto 's defective fuel system in terms of lives, injury, and property saved, and compared them to the costs of design modifications. In lament terms, It would be cheaper, by a factor of three to one, to pay off victims and their families than to make an $11 fix in each car (Bonamici, K, 2005).
Analysis based on ethical theories. Automobile lawsuits date as far back as the early 20th century when automobiles were first placed on the market. In MacPherson v. Buick Motor Co., the court ruled in favor of a plaintiff when the wooden spokes of a 1920 Buick Runabout 's wheel crumbled, causing the car to collapse and eject the plaintiff. Judge Benjamin Cardozo explained in his ruling that, "If the nature of a thing is such that it is reasonably certain to place life and limb in peril when negligently made, it is then a thing of danger. Its nature gives warning of the consequences to be expected. If to the element of danger there is added knowledge that the thing will be used by persons other than the purchaser, and used without new tests, then, irrespective of contract, the manufacturer of this thing of danger is under a duty to make it carefully" (Ezroj, 2014). It seems that Ford Motor Company mindset, moral and ethical thinking were on the lines of, and very similar to Judge Cardozo’s explanation. In the mid-1960s, a period marked by challenging accepted cultural norms, members of the public began to challenge the widespread use of the automobile with what were believed to be its inherent risks. Consumer advocates alerted the public to manufacturers ' lack of interest in incorporating safety features. One such consumer advocate, Ralph Nader, published his book "Unsafe at Any Speed" in 1965. Manufacturing a product and sticking a sign that tells you enter at your own risk seemed to be the unethical mindset present.
Nonetheless, In the early 1970s, Dennis Gioia, a newly hired recall coordinator at Ford, heard scattered tales that the company 's popular new compact, the Pinto, "lit up" when hit in a rear-end collision.
After several attempts and gathering enough evidence Gioia brought the problem before the recall committee. The evidence insisted that during preproduction crash tests, Ford leaders learned, eight of 11 Pintos had "suffered potentially catastrophic gas tank ruptures" on impact. The fuel tanks of the three other cars had survived only because they 'd been shielded from a set of studs that did the puncturing (Bonamici, K, 2005). With Ford continuing to ignore or make repairs, more and more people were dying after being rear-ended in these cars. One example happened in Elkhart, Indiana during the fall of 1978, where three teenage girls died when their Pinto, equipped with an allegedly faulty gas tank system, burst into flames. This significant tragedy was intensified when it came to light that the accident was foreseeable. By the date of the accident, the internal cost-benefit analysis prepared by Ford employees had been made public. The cost-benefit analysis coldly calculated the expected benefits of repairing the Pinto 's defective fuel system in terms of lives, injury, and property saved, and compared them to the costs of design modifications. The analysis revealed that, although Ford executives knew that the placement of the tank on the Pinto could cause gas leakage …show more content…
in the case of a rear-end accident, they chose not to adopt a safer design because it would have added to the cost and weight of the vehicle. In short, Ford was caught putting concern for profits ahead of safety. Conclusion and recommendations.
Ford discontinued the Pinto in 1980 after a costly recall, but the blow to trust would prove more lasting. Consumer activists would now act as safety watchdogs. Competitive advantage is not to just present a product for consumers to purchase, but to gain trust and establish a relationship where they will continue to be loyal. Ford Motor Company was not mindful of this, and when a California jury awarded a Pinto victim a then unheard-of $125 million (later reduced to $3.5 million) for pain and suffering, it roused class-action lawyers everywhere (Bonamici, K, 2005). The results could and should have been different. Ford’s President, Lee Iacocca displayed a lack of mindfulness which inadvertently lapsed his judgment. Gaining a competitive advantage by producing a vehicle under the recommended production guidelines was undisciplined and negligent. In 1966, the National Academy of Sciences published "Accidental Death and Disability - The Neglected Disease of Modern Society," treated automobile accidents as an epidemic, and provided further scientific data supporting the risks associated with driving. The report explained that in 1965, automobile accidents and other accidental injuries killed 107,000 people, temporarily disabled over 10 million, and permanently impaired 400,000 American citizens at a cost of approximately $ 18 billion (Ezroj, 2014). According to the report, "this neglected epidemic of modern society was the nation 's
most important environmental health problem" (Bennett, 1990, Sec. III). Good business sense is quality over quantity. Had Iacocca sat back and thought about what the ultimate end might be, he may have made decisions based on more of immediate concerns—like safety.
References
Bennet, S. (1990, June 01). Developments in the Movement Against Corporate Crime.
Corporate Crime under attack: the Ford Pinto Case and Beyond. New York
University Law Review, 65, p. 971
Bonamici, K. (2005, June 27). 1972: Ford decides to let the Pinto explode. Fortune.
151(13), p. 77-80, Retrieved from www.eds.b.ebscohost.comvlib.excelsior.edu
Dowie, M. (1977, September/October). Pinto Madness. Mother Jones.
Ezroj, A. (2014, January 01). Product Liability After Unintended Acceleration: How
Automotive Litigation Has Evolved. Loyola Consumer Review, 26, p. 470