...Running Head: CASE STUDY Case Study Team MGT/216 09/13/10 Teacher Abstract Take a step back into the past, 1971 to be exact, imagine being a proud new owner of a popular and affordable vehicle, the Pinto. The vehicle is perfect for the tight budgeted and built by a trusted company (Ford). Then the unexpected happens, it is in a rear end accident. Upon the accident the car explodes. Sounds like a bad dream, right! (See video link in PowerPoint presentation) The following discusses a similar story that will from here forward be in reference as the Pinto Case, in which Ford was accused of being at fault for selling a shoddy car to the public. Were they at fault? What was the ethical dilemma? What were the social pressures? All of this and more is here within in detail. Pinto Case Study When Ford Motor Company had to determine what action to take in regards to the pinto many considerations were made. The company had to decide whether to install a baffle on the Ford Pinto to prevent the possibility of a puncture in the gas tank by a bolt from the bumper. The issue was found during a test done after the car was in production and on sale in the U.S. The gas tank is in the back of the car. During a rear-end test it was found that if a car travels more than 20 miles per hour and is hit from behind it is possible that a bolt from the bumper can puncture the gas tank. This can cause an explosion. Ford had the choice...
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...Case 10: Ford’s Pinto Fires: The Retrospective view of Ford’s Recall Coordinator Ford motor company, North America’s subcompact automobile company; design Pinto in 1971 in order to compete with fuel efficient Volkswagen and Japanese imports. Pinto’s major design flaw- a fuel tank prone to rupturing with moderate speed rear-end collisions- surfaced not too long after the Pinto’s entrance to the market. In April 1974, the Center for Auto Safety Administration (NHTSA) to recall Ford Pintos due to the fuel tank design defects. As a result of tests performed of NHTSA, as well as the extraordinary amount of publicity generated by the problem, Ford Motor Company agreed to recall Ford Pintos. Dennis A. Gioia was the field recall coordinator at Ford Motor Company as the Pinto fuel tank defect began unfolding. Gioia responsibilities include the operational coordination of all the current recall campaigns, tracking incoming information to identify developing problems, and reviewing field reports of alleged components failures that led to accidents. Business Ethics: In the Ford Pinto Case, what moral issues does the Pinto case raise? what is the dollar value of the human life.Business Ethics: In the Ford Pinto Case, what moralissues does the Pinto case raise? that a car that explodes when hit in the rear can be used to deliver mailBusiness Ethics: In theFord Pinto Case, what moral issues does the Pinto case raise?That businesses should not be putting a value on human life and disregard...
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...Case Study Discussion and Executive Summary June 27, 2011 MGT/216 Case Study Discussion and Executive Summary This paper explores “The Ford Pinto Case” managing of business ethics. Numerous factors suggest within this research that Ford Motor Company was negligent and violated its code of ethics. To understand how relationships are affected a closer look at Ford Motor Company missions and values will align Team B’s personal values with Ford Motor Company. In this paper the study to examine are the role of people, products, and profits in the decisions made regarding the Ford Pinto. Key factors surrounding the Ford Pinto Case The death of Lynn Marie Ulrich, Dana Ulrich and Lynn’s sister, and Judy Ann along with many others was what brought the controversy of the Ford Pinto’s faulty gas tank placement to a climax. After so many unnecessary deaths the release of the Ford Pinto was the responsibility of Ford’s CEO Henry Ford II and Ford’s new president Lee Iacocca. Iacocca reduced the average production of a car from three and a half years to a little over two years. Iacocca was aware that during crash testing the Pinto’s gas tank exploded upon collision but was desperate to expedite the vehicle’s release on his deadline. After the discovery of the Pinto’s faulty gas tank, Ford’s president decided it would be costly to make changes in the Pinto’s gas tank location and its size. The Ford Pinto cost $2000 and making changes would increase its price thus possibly...
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...Ford Motor Company Pinto Case Karen Nollet, Alonso Miller, Michael Morra, Pamela Tenori MGT/216 Abstract In 1971, Ford Motor Company (FMC), on the advice of then vice-president Lee Iacocca, introduced the first subcompact vehicle, the Ford Pinto. After production, Ford discovered a defect in the design on the fuel system; the gas tank was placed in the rear of the vehicle. This error could cause the vehicle to explode on low speed rear end collisions. Ford conducted a risk/analysis to determine whether to recall the vehicles or leave the situation as is and suffer the consequences as they arise. After concluding that the vehicles could be modified for $11 per vehicle, Ford decided not to recall the vehicles. Based on their risk/analysis the cost to recall the vehicles sold would be $137 million, Ford determined that it would be more profitable to leave the vehicles as is and pay out costs in lawsuits because this figure adjusted to $49.5 million, substantially lower than the cost to recall the product. Ethics and morals would appear to be ignored for profit and gain. Ford Motor Company Pinto Case Ford Motor Company Mission Statement (1996), “We are a global family with a proud heritage passionately...
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...Ford Pinto Case In the late 1960s Ford Motor Company developed the idea of the Ford Pinto. Foreign automobile such as Germans and Japanese manufactures dominated the small car market. Ford Motor Company did not want to stay behind in production. Chief Executive Officer, Henry Ford II and Lee Iococca’s rushed building new compact cars out in the market within two and half years which, was the Ford Pinto and the shortest production planning. Production and distribution of the 1970s Ford Pinto stirred controversy regarding safety concerns. Ford’s desire to compete with the foreign manufacturers led Ford to overlook known design flaws and their own ethics while in search of higher profits. Ford assigned a team of engineers to work on nothing but the Pinto. This team was required to stick to Iacocca’s goal of “the limits 2000”; this meant that the car could not weigh more than 2000 pounds. This became a challenge for the engineers and created concerns regarding the placement of the fuel tank. Because of the accelerated production the testing was not done thoroughly. Out of 11 Pintos subjected to rear end collisions, eight failed the test. Only the three with baffles between the tank and bumper and a special interior tank lining met safety standards. The project was almost complete, and it was not possible to make redesign revisions and meet the deadline for the release of the Pinto. The car met the requirements for the American public. It was not long before...
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...philosophy. These ethics are learned through friends, family, and formal education. However, moral philosophy can be influenced by business and corporate culture. This is why it is important for all of society that business and corporate leaders understand and manage their firms with the highest ethical respect possible. It is the social responsibility of these companies to be aware that they are accountable for their actions and what they may or may not do can echo an eternity into the world’s future. In 1972, Ford Motor Company released the Ford Pinto, a small cheap car that could financially compete with the new economic cars from Asia. The Ford Pinto got a lot of attention because it was the first American made car to rival the Asia automobiles. However, the Pinto had a design flaw in that the position of the fuel tank was poorly placed and as a result was highly susceptible to car fires. This flaw was recognized by ford but was deemed an economic step backwards. If the production to fix the flaw was put in place, it would raise the overall price of the car. Thus, making the car less attractive to potential buyer. Ford decided to push the car despite the recognition of the fatal flaw. To make this decision Ford ultimately broke it down in terms of money. Ford determined that to go back and fix the design flaw to would cost $137 million as oppose to $49.5 million for those who will lose their life because of the design flaw in the Ford Pinto. (bizcovering) What Ford did in the...
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...Amy Bruney Marketing Ethics I. Introduction II. Literature Review III. Recommendations & Implications for Marketing Managers IV. Conclusion V. Sources INTRODUCTION “For seven years the Ford Motor Company sold cars in which it knew hundreds of people would needlessly burn to death.” Mark Dowie, Author of Pinto Madness (8) One of the biggest automotive news stories in the latter part of the 1970’s dealt with tales of exploding Ford Pintos and the considerable awards civil court juries were presenting to victims of accidents involving the cars. Ford produced the Pinto automobile from 1971 to 1980. Initially the car sold well, but a defect in the early models made Pintos prone to leaking fuel and catching on fire after relatively low-speed, rear-end collisions. The Pinto’s gas tank was located behind the rear axle. A rear-end collision of about 28 miles per hour or more would crush the car’s rear end, causing the tank to split and the filling pipe to break loose. It had been proven that spilled fuel and sparks from the crash caused fires that produced fatalities or serious burns. Was Ford aware of the potential problems in the framework of the Pinto? Was there an easy, inexpensive way to fix these problems? Was the Pinto fire controversy a lot of hype, or had Ford truly discounted human lives in order to save a few dollars? If Ford management really placed marketing considerations above safety, was that objective ethical...
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...The Case of the Ford Pinto By James Abstract Product harm crisis can be defined as a sudden break in a product’s life cycle (Siomkos, G.J and Kurzbard. J. 1994). In 1971 the Ford Motor Company created a product harm crisis with the introduction of the Ford Pinto. The Ford Pinto is known to be one of the most dangerous vehicles ever produced in automotive history due to several serious design flaws. This paper will identify the factors that contributed to the product harm crisis, compare and contrast the findings of various studies on a product harm crisis and finally synthesis the research findings and provide a post mortem recommendation to the Ford Motor Company on how the Ford Pinto product crisis should have been handled. The Case of the Ford Pinto In 1968 the Ford Motor Company decided to market a vehicle that was small, inexpensive and would appeal to all car buyers. The Vice President of Ford Motor Company at the time was Lee Iacocca. Mr. Iacocca approved the plan for the Ford Pinto based on the parameters of the car weighing 2000 pounds and costing $2,000.00 dollars (Danley J. 2005). By placing these parameters on the car’s designers, they were limited from the beginning and ended up with a failed product. The key factors that contributed to the product crisis included the Ford Pinto being rushed to production in twenty five months, the timeframe to production causing designers and producers of the car to cut corners and finally...
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...Ethics 368 22 June 2014 The Ford Pinto Case from a Utilitarian Perspective “Utilitarianism adopts a teleological approach to ethics and claims that actions are to be judged by their consequences” (DeGeorge 44). When looking at an decision from this view, we are to be impartial that decisions are not right or wrong by themselves, but also that we must analyze the results to determine if actions are good or bad. We know that Ford became more completive in the subcompact market from the Pinto sold in 1971 thru 1978. Ford also captured their fair share of the market for subcompact. There are several things about utilitarianism that make it appealing as a standard for moral decisions in business. One of them being “act utilitarian”, which holds individual actions to a test. “A theory developed by Jeremy Bentham and introduced to the world in his book An Introduction to the Principles of Morals and Legislation, released in back in the 17th century” (Bentham, Jeremy). There are many ways to determine the outcome of an action. Our reactions to pain and pleasure is a measure. The good that an action provides for the majority of those involved or the greatest number of people is another. Ford had a product to deliver and consumers wanted it. In determining whether this action produces more pain or pleasure for the majority, hedonistic calculus can be used. It is easier to be impartial, when using this calculus on an ethical decision. The calculus weighs all the factors involved...
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...According to the case study the ford pinto company knew that they sell faulty cars to their customers and due to their sales it has led to the death of their customers. The company ford pinto knew that the way they manufacture cars was in the wrong place and they kept it as secret Ford knew that the cars they produced had lots of issues concerning the safety and this was involved in the rear where the gas pump was at. This has led thousands dead. The ford company knew about the problem before distributing it their consumer because the company engineer had experiment the problem of the car but ford kept this as a secret due to the fight the ongoing competition in the market. Ford company waited for a very long time to solve this problem and this took them eight years and before the finally came to a conclusion this has led to the death of hundreds thousands pf its consumers. This is very unethical and According to the ethical theory of john stuart mill in 1897 mill had discovered that its goal is to justify the utilitarian principles as the foundation of morals, in details the principle says actions are right in proportion as they tend to promote overall human happiness and in the case of ford pinto no harm should be made as this apply to the theory of mill that customers should not be brain washed due to their rights to life and free expression and safety should be very important to their lives of their consumer and also in general (mill, 1897). It was leading into the abuse...
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...John Brevard M5990 – Corporate Responsibility & Society November 24, 2013 Week #5 Short Written Assignment Pinto Fires and Personal Ethics: A Script Analysis of Missed Opportunities by Dennis A. Gioia, is a sad article which focuses on the moral muteness of the author during his experience at the Ford Motor Company. However, before providing an analysis, several definitions are required: * Generalization Test – There must be a reason for an action and it should be consistent and based on one’s understanding of how the world works, with the assumption that everyone who has the same reason will act the same way. * Utilitarian Test - An action is ethical only if no other available action creates greater total net utility, i.e., there should be an ultimate end that might be called utility. * Virtue Test - Requires one to act in a way that is logically consistent with who they are in regards to their virtues and integrity. * Liberty Principle - Defined as a policy must result in the greatest basic liberty for everyone. It addresses autonomy. * Difference Principle - Defined as a policy must not create inequality unless it results in the greatest benefit for the least advantaged, applies to allocations of utility, e.g., a company’s wage scale. A “child of the 60’s”, Goiai seemed to have a strong value system that led him to question the perspectives and practices he observed in the world. A distaste of the Vietnam War...
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...The Ford Pinto Case Back in the 1970s the Ford Pinto was debuted without regard to proper safety features and concern for proper ethics while producing this automobile. Buyers wanted lower pricing and bigger trunk space more than the consideration for safety. Lee Iacocca, president of Ford, ran the business striving for higher profits and cutting costs. His lack of interest for human life initiated many lawsuits against Ford and, in the end, was a far bigger cost than installing safety features in the Pinto in the beginning. The biggest concern regarding the role people played in the Ford Pinto case was the concern for cutting costs and making the biggest profits over the concern for human life. Severally jeopardized in this case were proper corporate morals and ethics. This started when Lee Iacocca acquired the position of president from the former President Semon Knudson. Lee Iacocca celebrated much success with the Mustang and wanted to market small cars to compete with the foreign car markets. Lee Iacocca drove to promote the Ford Pinto by 1971. Because it typically takes three and one-half years for the production of an automobile, to have the Ford Pinto to the showrooms by 1971, only left two years to launch the Ford Pinto. During the production process, crash tests revealed safety issues with the gas tank in the rear of the car. If the car were struck from behind even at a slow speed, the gas tank would rupture, and explode upon impact. Lee Iacocca’s decisions...
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...Ford Pinto: An Ethical Inferno Michael W. Daniels Excelsior College Introduction and Analysis “Pinto crashes caused the death and mutilation of 900 occupants after their cars burst into flames after rear-end collisions,” Robert Sherefkin explains in his article Lee Iacocca's Pinto: A fiery failure. The engineered design of the Ford Pintos resulted in the gas tank rupturing in low speed rear end collisions. The design flaw was recognized early in the Ford Pinto’s production. According to Dowie’s article Pinto Madness. Mother Jones, “Internal company documents in our possession show that Ford has crash-tested the Pinto at a top secret site more than 40 times and that every test made at over 25 mph without special structural alteration of the car has resulted in a ruptured fuel tank.” Dowie then explains how more than a quarter of those tests were performed prior to the initial release of the vehicle. It was estimated that just 11$ upgrade per vehicle would have remedied the problem (Dowie, 1977). On June 10, 1978, almost a decade after the first Pinto was built, Ford eventually agreed to recall the Pinto (Boyce, D, 2012). The decision was made after countless lawsuits over a span of eight years drained the Ford Motor Company of millions of dollars. The company’s President Lee Iacocca could have rectified the design flaw but deemed it too late in production to reconstruct the vehicle. His requirement of the car weighing less than 2000 pounds and cost of under...
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...Ford Pinto: Setting the precedent for corporate crime Caleb Bede Accounting 573: Accounting Fraud, Criminology, & Ethics Joan Moore Sunday, September 21st, 2014 Keller Graduate School of Management 2014 Caleb Bede Keller Graduate School of Management of DeVry University 9/21/2014 Case Analysis Project: Research the Ford Pinto case in Friedrichs (p. 72 & 312) and online. Provide a brief synopsis of the case and answer the following questions: 1) What has happened to the key players since the events in this case? 2) Were the consequences they experienced as a result of their role appropriate under the circumstances and why? 3) What preventive and detective controls can be put in place? 4) How does the Ford Pinto case compare to recent Toyota recalls? Synopsis: With intense competition from Volkswagen and other foreign domestic car companies, Ford needed to act fast and respond quickly to the influx...
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...Introduction Ethics, or moral philosophy as it sometimes called, is the systematic endeavor to understand the moral concepts and justify on the moral principles and theories. It undertakes to analyze such concepts as ‘right,’ ‘wrong,’ or ‘ought,’ ‘good, and ‘evil’ in their moral contexts. It builds and scrutinizes arguments setting forth large-scale theories on how we ought to act, and it seeks to discover valid principles such as (never kill an innocent human beings) and the relationship between those principles are (does saving a life in some situations constitute a valid reason for breaking a promises?). Whereas much of philosophy is concerned with the knowledge of what is the (methaphysics, philosophy of science, philosophy of religion, and philosophy of the mind), ethics is concerned with values that what not is, but what ought to be (Pojman, 1998) Based on the assessment that has been given, it require us to choose an organization of our choice (could be a company or other organization in the private or public sector) that have a relevant reference to the key principles and approaches of the business ethics. However, in this assessment, we need to critically evaluate its performance by applying an appropriate criteria that may identify the extent to which ethical issues are being managed or resolved. With this, we need to include two of the following approaches in the assessment and that is by (1) including an identification and evaluation of ethical dilemmas within...
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