...Acting as a recall coordinator would by no means be an easy task. However, if I were to put myself in that role, here is what I believe I would do following the eight-step method to ethical decision making. The first step is identifying the relevant facts. In the Pinto Fires Case, I believe there are six large facts that are the most relevant to determining whether a recall is the appropriate course of action. The first fact is that Ford Motor Company discovered the issue before the Pinto was released. With many recalls, the issues are not discovered until after the products in question are released, but Ford knew about this major issue and released the car anyways. The second crucial fact builds off the previous one – Ford knew how to fix the issue. They had found three possible solutions through their testing, but did not implement any of them. The third relevant fact is that Ford had shortened their amount of preparation time to release it earlier. This was something that had never been done before, so the fact that they cut down the amount of time they were spending on preparing this car by over a year was a recipe for disaster. The fourth fact to consider is the fact that Ford Motor Company was within the legal standards at the time. While Federal Motor Vehicle Safety Standard 301 had been proposed, it had not been adopted, so Ford’s move was legal. Furthermore as the fifth fact, in the 1970s, consumers were not nearly as concerned with safety. In fact, Ford had...
Words: 1313 - Pages: 6
...five Relevant Facts * At its time of release, the Pinto met the required standards. * I received field reports suggesting Pintos were susceptible to “exploding” in rear-end collisions at speeds under 25 miles per hour. * Last year in San Bernardino, California a neighbor of 13 year old Richard Grimshaw’s gas tank ruptured, causing the car to burst into flames. The neighbor did not die from impact, but was killed in the fire. Grimshaw suffered third-degree burns over 90 percent of his body. * The projected costs for 180 burn deaths ($200,000 x 180), 180 serious burn injuries ($67,000 x 180), and 2,100 burned vehicles ($700 x 2,100) is $49.5 million. * Crash-test reports show that eight of the eleven Pintos tested with an average 31 mile per hour rear end collision failed fuel leak tests with the standard fuel tank. The 3 that survived the leak test because special measures were taken to prevent tank rupture or fuel leakage by using a plastic baffle between the axel housing and the gas tank, a steel plate between the tank and the rear bumper, and a rubber lining in the gas tank. * An $11.00 safety improvement on 11 million cars and 1.5 million trucks will cost a total of $137.5 million. 2. Identify ethical issues using both a deontological AND a consequential perspective. From a deontological approach, the rights of Ford Motor Company would conflict with those of people involved in the Pinto fires. An individual has the right to health and safety, and...
Words: 1035 - Pages: 5
...PINTO FIRES CASE The assumption that ‘it’s easy to be ethical’ assumes that individuals automatically know that they are facing an ethical dilemma and that they should simply choose to do the right thing. But decision makers may not always recognize that they are facing a moral issue. Rarely do decisions come with waving red flags. Dennis Gioia was recall coordinator at Ford Motor Company in the early 1970s when the company decided not to recall the Pinto despite dangerous fires that were killing the occupants of vehicles involved in low-impact rear-end collisions. In his information and overloaded recall coordinator role, Gioia saw thousands of accident reports, and he followed a cognitive “script” that helped him decide which situations represented strong recall candidates and which did not. The incoming information about the Pinto fires did not penetrate a script designed to surface other issues, and it did not initially raise ethical concerns. He and his colleagues in the recall office did not recognize the recall issue as an ethical issue. From the standpoint of Hooker’s test, we will start with the geralizability test. Hooker (2011) states that to pass generalizability, it must give the reasons for an action have to be consistent with the assumption that others who have the same reasons act the same way. To release the Pinto as scheduled and risk the safety of those who purchased it or spend more time designing the car, thereby seceding more of the subcompact...
Words: 716 - Pages: 3
...In the article, Ford Pinto Fuel-Fed Fires, “the Center for Auto Safety petitioned the National Highway Traffic Safety Administration to recall Ford Pintos due to defects in the design of the strap on the gas tank which made it susceptible to leakage and fire in low to moderate speed collisions,” (Ford), clarifies the conception that improvements are indefinite. Not in this case, “Mark Dowie of Mother Jones Magazine, published documentation that Ford Motor Company was aware of the weakness in the fuel tank before the vehicle was placed on the market, but it would be “cheaper” for Ford Motor Company to pay liability for burn deaths and injuries rather than modify the fuel tank to prevent the fires from occurring. Dowie also showed that Ford Motor...
Words: 292 - Pages: 2
...College for Financial Planning ETH 550—Business Ethics Master Course Syllabus I. Course Description Course Description This course is designed to achieve the following objectives: Explore the ethical dimension in the current global environment. Study and apply major normative ethical theories to business situations. Understand the relevance of stakeholders to business decisions. Improve ethical and moral decision-making processes. Analyze case studies that present ethical business dilemmas. Understand moral, amoral, and immoral decisions in business situations. Encourage ethical behavior and professionalism in all activities. Prerequisites There are no prerequisites for this course. II. Overview Overview The goal of this course is to teach students how to ethically interact in today's global business environment. III. Required and Recommended Text Required Text Modern Language Association of America. MLA Style Manual and Guide to Scholarly Publishing. 3rd ed. New York: Modern Language Association of America, 2008. ISBN 0-87325-699-6. Perkins, John. Confessions of an Economic Hit Man. Plume, 2005. ISBN 978-0452287082 (paperback). Weiss, Joseph W. Business Ethics: A Stakeholder and Issues Management Approach. 5th ed. South-Western, 2009. ISBN 978-0-324-58973-3 (paperback). How to Order Texts You may order textbooks online at www.cfpbookstore.com, by fax at 800-274-9105, or by telephone at 800-274-9104. Students interested in selling their textbooks...
Words: 508 - Pages: 3
...Managing Product Safety: the Ford Pinto Summary: Around 1967 Ford Motor Company decided to design a small size car called the Ford Pinto. The automobile industry at the time (and still is) was highly competitive and very cyclical. In the late 1960's, America began to see the influences of foreign vehicles. Facts Around 1967 Ford Motor Company decided to design a small size car called the Ford Pinto. The automobile industry at the time (and still is) was highly competitive and very cyclical. In the late 1960's, America began to see the influences of foreign vehicles. Prior to that, cars were bigger and less fuel efficient, allowing the Japanese to gain substantial market share with the smaller, more economical vehicles, and the need to react to this pressure was even greater at Ford. Even though they held the number two spot in market share behind General Motors, they only held a 22.3% market share compared to General Motors at 46.4%, a very significant difference. There was strong competition for Ford in the American small-car market from Volkswagen and several Japanesecompanies in the 1960's. In order for Ford to stay competitive and fight off competition, they rushed its newest car the Ford Pinto into production in much less time than is usually required to develop a car. The regular time to producean automobile was 43 months; Ford took only 38 months. Before production, the engineers at Ford discovered a major flaw in the cars' design. In nearly all rear-end crash test...
Words: 2593 - Pages: 11
...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...
Words: 867 - Pages: 4
...Under the leadership of Ford CEO Lee Lacocca, The Ford Pinto Company introduced in 1971 in Canada, and later in U.S, had reputation as being the safety pioneer in the automobile industry. But was trouble impending, the car did not pass on the test, meaning that it failed bellow the state of the art for cars of that size. The design of the car flaws in its Pinto model could cause the car to burst into flames even in minor rear-end collisions. At the time there was no National Highway Traffic Safety Administration rear-end impact standard. Understandably American automobiles were losing market share in the 1960’s due to cheaper Japanese imports. Smaller, cheaper, better gas mileage, and lighter all meant better value to the consumers. Competition is suppose to fuel innovation and help make better products with smilier or better value. In this case Lee Iaccoca did not make a better product. Iaccoca wanted to simply compete and with the Japanese imports. In 1971 The Ford Pinto was made and produced in a accelerated fashion, so it was designed and produced in 25 months rather than the 43 months that it should have taken. Truth to be told it was a decent design it weighed under 2000 pounds and it cost less then 2000 dollars. The only really down fall was the rear-end design the Pinto was not really tested for rear-end impact, and when Ford engineers testing the rear-end impact for standard safety procedure the car failed the test. To make matters worse the rear-end testing...
Words: 1779 - Pages: 8
...their products effect on consumers to produce a desirable bottom line. Ford is one company during the 1970’s many people consider put its bottom line before the safety of its consumers, thereby leading many people to question its business research and ethical practices. The controversy came about with the development of the Ford Pinto. The Ford Pinto was manufactured as a response to the overwhelming competition from Volkswagen, Toyota, and Datsun in the abundant small car market. Lee Iaccoca was the vice president for Ford Company during the development of the Ford Pinto, and was very influential in launching the project. He had the credit of the Ford Mustang to his name, and was involved with several other developmental projects throughout the company. Lee Iaccoca was not initially receptive to the idea of Ford competing in the small car market. The point was argued however that lower income customers would buy an affordable vehicle such as the Ford Pinto, and thereby increase the company’s chances the customer would eventually upgrade to a more profitable vehicle (cite pg 206). Lee Iaccoca eventually agreed and stated the Ford Pinto could cost no more than two-thousand dollars, and could weight no more than two-thousand pounds (cite pg 207). During this time of negotiations amongst Ford’s Board, the National Highway Traffic Safety Administration (NHTSA) established the Safety Act of 1966. The changes to highway regulation safety meant car companies would have...
Words: 828 - Pages: 4
...good and bad things may be discovered, and remaining ethical in your findings and how you apply it to your business, could invariably save your business far more than money. Here we will explore the ethical decisions made by Ford Motor Company after research found their Ford Pinto to be unsafe in rear-end collisions. In an effort to beat out strong foreign competition from in the small car market, Ford Motor Company produced the Ford Pinto in 1970. Before this time, Ford dominated in the production of larger vehicles and never was considered a contender in the small car market. Lee Iacocca wanted to change this, as Europe had made fast strides to match America in the automobile market by 1970. Europe and Asia benefited from the small car market, as it was easier to ship vehicles and thus expanding their business into other countries and making them very popular in the world market. America was limited in their ability to expand their current market to other countries, as shipping these excessively larger vehicles was not practical. America could only expand business to Canada and Mexico, so the Ford Pinto would be an important opportunity for American automobile market. Lee Iacocca wanted the Ford Pinto in showrooms for the new 1971 line of automobiles, which would make it the fastest produced vehicle in history. Normally, vehicles took three and half years to make from conception to production, so producing a car within two years would turn out to become Fords most disastrous...
Words: 657 - Pages: 3
...The biggest influence on the decision to implement the baffle comes from a human element that seems to be missing from Ford’s decision. Human life is priceless, but Ford did manage to place a number on it. The loss of life is enough external pressure to influence the recall of the Pinto and add a part that cost less than a trip to the movies. “One Ford engineer, when asked about the dangerous gas tank said, “Safety isn’t the issue; trunk space is” (De George, 2005, p. 116). The Ford Company did not operate with a concern for the people. Instead of placing the safety of consumers at the top of the list, Lee Iacocca placed profit and competition above all. “As Lee Iacocca was fond of saying, “Safety does not sell” (Newton & Ford, 2008, p. 297). Recalling the cars did not seem to be of any concern and losing money is not an option. The company was not short on resources. They had the information, the materials, and the know-how to produce a safe vehicle. The consumers deserve to have a product that is safe and affordable. Unfortunately, the powers at the top did not take into account what the consumer thinks. The risk/benefit analysis was a large part of the decision to avoid the recall. This would place a dollar amount on human life. It would cost the company more to fix the problem than to save a number of lives. “When someone dies as a result of a dangerous product, unsafe treatment or negligent corporate behavior, we can't measure how much the deceased person...
Words: 515 - Pages: 3
...Legal matters in business and society as a whole have changed greatly over the past couple of decades; and not necessarily for the better. Between attorneys wanting to make a buck at any cost, and business owners losing their diplomacy skills in exchange for resenting and milking others who they think have wronged them, the need for legal services has exploded in the United States (U.S.). At the dawn of the 21st century, law is as important in society and business as is marketing, advertising and experienced employees. Various use and purpose of law in business and society. Originally, the function of law in business and society was a plus. America developed, arguably, the best legal system in the world. This system was based off of righting wrongs. For criminal law, rehabilitation for juveniles, and punishment and reparation for adults is/was the main goal. In civil law, putting the plaintiff in the same position had the plaintiff not been wronged is/was the goal. Modernly, much has been adulterated. First, regarding the motives of attorney's, modernly, things have changed. A marvelous and historic thing happened when women's rights and rights for minorities were addressed and corrected. But then, something changed. Technology has advanced more in the past 40 years than in the entire recorded history of mankind. This advancement has enabled those countries that are more advanced and who enjoy the freedoms of a representative democracy, to be freed up from having...
Words: 1273 - Pages: 6
...over the importance of profits. But they do quarrel over whether or not business firms have obligations beyond making profits. A consumer may be a pet owner who feeds and provides care for a beloved animal, a doting grandparent who buys toys and clothes for the grandkids, an individual who wears contact lenses or hearing aids, a patient who buys prescription medications, or vehicle owner. Should a consumer have certain expectations from the suppliers and producers of the products that he buys? Can we trust corporations that they will not produce what will jeopardize the human life? Was Ford to be blame in the pinto case? Must we wait for the characters like “Erin Brokovich” to fight on behalf of the helpless consumers? Who is to be blamed for the McDonald’s hot coffee case-the producer, the consumer or the regulators? Almost thirty years has passed since the Pinto accidents and what followed from it. We still don’t know how “safe” a...
Words: 4161 - Pages: 17
...THE FORD PINTO CASE: THE VALUATION OF LIFE AS IT APPLIES TO THE NEGLIGENCE-EFFICIENCY ARGUMENT Christopher Leggett Law & Valuation Professor Palmiter Spring, 1999 Abstract Text of Paper Abstract The cases involving the explosion of Ford Pinto's due to a defective fuel system design led to the debate of many issues, most centering around the use by Ford of a cost-benefit analysis and the ethics surrounding its decision not to upgrade the fuel system based on this analysis. ISSUE Should a risk/benefit analysis be used in situations where a defect in design or manufacturing could lead to death or seriously bodily harm, such as in the Ford Pinto situation? RULE There are arguments both for and against such an analysis. It is an economically efficient method which has been accepted by courts for numerous years, however, juries may not always agree, so companies should take this into account. ANALYSIS Although Ford had access to a new design which would decrease the possibility of the Ford Pinto from exploding, the company chose not to implement the design, which would have cost $11 per car, even though it had done an analysis showing that the new design would result in 180 less deaths. The company defended itself on the grounds that it used the accepted risk/benefit analysis to determine if the monetary costs of making the change were greater than the societal benefit. Based on the numbers Ford used, the cost would have been $137 million versus the $49.5 million...
Words: 9256 - Pages: 38
...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...
Words: 1336 - Pages: 6
