The Ford Pinto Project
The Ford Pinto Project
The Ford Motor Company has been the leading car company for many decades. In the late 1960’s early 1970’s the company was losing the battle with Japanese with the small efficient cars. Lee Iacocca, Chief Executive Officer the Ford Motor Company wanted a car that will be competitive to these Japanese compact cars. With this intention in mind, the company wanted to manufacture a sub-compact vehicle that weighs less than 2,000 pounds and costs under $2,000. The result is the Ford Pinto. The Ford Pinto was one of the earlier sub-compact cars of the 1970’s. The Pinto was a catalyst in the revitalization of domestic compact cars at this time when Japanese imports were front rumors. Sure the car was simply affordable but had one flaw that would tarnish its reputation and the company’s. The Ford Pinto had fire hazard issues resulting from the placement and construction of the gas tank. When a Pinto is rear-ended the car would burst into flames resulting in an explosion. The company realized this concern during production. Because Iacocca wanted a fast sell of these cars records indicated that there was not a rear end collision test conducted until months after it was already in the market. Management did a cost analysis and determined that the cost of fixing the problem versus any lawsuits; it would be cheaper to pay for the lawsuits that would arise.
Given the case study a quick review, money, objective, time, and ambition are the key factors surrounding the Ford Pinto case.
Money is the number one key factor because starting from the idea of this product line; the company prepared a cost analysis/profit of producing the car. The company has a budget to work with that will enable them to build it. The other concern is the manufacturer’s suggested retail price of not a cent more than $2,000. Even after the Pinto was discontinued back in 1978 and the cars were auctioned off, Ford still made the profit that they expected to make
The Ford Motor Company has been the leading car company for many decades. In the late 1960’s early 1970’s the company was losing the battle with Japanese with the small efficient cars. Lee Iacocca, Chief Executive Officer the Ford Motor Company wanted a car that will be competitive to these Japanese compact cars. With this intention in mind, the company wanted to manufacture a sub-compact vehicle that weighs less than 2,000 pounds and costs under $2,000. The result is the Ford Pinto. The Ford Pinto was one of the earlier sub-compact cars of the 1970’s. The Pinto was a catalyst in the revitalization of domestic compact cars at this time when Japanese imports were front rumors. Sure the car was simply affordable but had one flaw that would tarnish its reputation and the company’s. The Ford Pinto had fire hazard issues resulting from the placement and construction of the gas tank. When a Pinto is rear-ended the car would burst into flames resulting in an explosion. The company realized this concern during production. Because Iacocca wanted a fast sell of these cars records indicated that there was not a rear end collision test conducted until months after it was already in the market. Management did a cost analysis and determined that the cost of fixing the problem versus any lawsuits; it would be cheaper to pay for the lawsuits that would arise.
Given the case study a quick review, money, objective, time, and ambition are the key factors surrounding the Ford Pinto case.
Money is the number one key factor because starting from the idea of this product line; the company prepared a cost analysis/profit of producing the car. The company has a budget to work with that will enable them to build it. The other concern is the manufacturer’s suggested retail price of not a cent more than $2,000. Even after the Pinto was discontinued back in 1978 and the cars were auctioned off, Ford still made the profit that they expected to make