Term Paper on "Pinto Automobile Makers Are Responsible"

Term Paper 6 pages (1813 words) Sources: 1+

[EXCERPT] . . . .

Pinto

Automobile makers are responsible for the lives of many people when they place vehicles on the market. In the past their have been cases where automobile manufacturers have placed profits above the safety of consumers. Although the automobile industry had undergone a significant overhaul in the 1960's there were still some issues concerning the safety of cars and automobile manufacturers not abiding by the newly established standards. Although many companies complied, others were anxious to get cars into the market and in doing so overlooked or simply didn't care about defects that would ultimately cause the deaths of many people. The purpose of this discussion is to evaluate the ethical behavior of the Ford Motor Company as it relates to the manufacture of the Ford Pinto Automobile.

The Ford Pinto

The continued manufacturing and marketing of the Ford Pinto is a prime example of a company's desire to maintain profits even in the wake of many fatalities. This vehicle which was manufactured in the 1970's had a gas tank that was located in an area that made the car vulnerable to fires when it was involved in car crashes ("Managing Product Safety"). While there are conflicting reports whether or not Ford knew about the defect before the car was placed on the market, most have surmised that the company knew about the defect for too long before it decided to let the public know about the defect ("Managing Product Safety"). Here in lies just one of the ethical dilemmas facing Ford as it relates to this issue.

This was a particularly difficult dilemma for ford because the Pinto became one of the company's best selling vehicles within a six-year period ("Managing Product Safety"). The popularity of the car also led to the development of a competitive advantage over GM, the other large American automobile company. In addition, the Pinto was the only small vehicle in Ford's line and the company did not plan to manufacture another type of small car until 1980 ("Managing Product Safety").

It is believed that one of the reasons why the Ford Pinto was defective had to do with the rapid way in which the planning process for the car took place. The actual production of the Pinto started in August of 1970. This meant that there was only a development time of 38 months, which was five months below the average development time in the industry ("Managing Product Safety"). However, the article also explains that when the Pinto was in development there were no government standards concerning the safety of a car in rear end crashes. However, some standards had been proposed and ultimately Ford voluntarily adopted a standard in which 20 mph design objective. The company conducted several tests under this standard and the car failed in crashes over 25 mph ("Managing Product Safety"). In the end the poor design of the company made it vulnerable to fires. The company reviewed several ways to correct the problem but in the end they found that the type of design that was needed would require the major redesign of the vehicle. Indeed the company did a cost benefit analysis and determined that is would be cheaper to One of the tools that Ford used to argue for the delay was a "cost-benefit analysis" of altering the fuel tanks. According to Ford's estimates, the unsafe tanks would cause 180 burn deaths, 180 serious burn injuries, and 2,100 burned vehicles each year. It calculated that it would have to pay $200,000 per death, $67,000 per injury, and $700 per vehicle, for a total of $49.5 million. However, the cost of saving lives and injuries ran even higher: alterations would cost $11 per car or truck, which added up to $137 million per year. Essentially, Ford argued before the government that it would be cheaper just to let their customers burn (Ford Pinto)!"

While a cost benefit analysis is commonly used when making certain business decisions, when such an analysis involves human life it becomes a serious ethical issue. Companies have a responsibility to their customers not to allow defective products to be produced or to remain on the market. This is particularly true when the product is extremely popular and the company is aware that many people's lives are at risk. A cost benefit analysis in this case is certainly unethical. The author asserts that Taking an ethical approach to the Ford Pinto case makes accepting the risk/benefit analysis performed by the Ford Motor Company difficult. In making what seems to be the correct decision based on numbers, Ford is essence adopted a policy of allowing a certain number of people to die or be injured even though they could have prevented it. When taken on a case-by-case basis the decision seems to be a blatant disregard for human life. From a human rights perspective, Ford disregarded the injured individual's rights and therefore, in making the decision not to make adjustments to the fuel system, acted unethically (Leggett, 1999)."

In addition, the company ended up loosing much more than it had considered when it conducted the cost benefit analysis. The company did not take into consideration the type of monetary awards that the company would have to pay victims and their survivors. They also underestimated the impact that this type of publicity would have of the sell of the company's other vehicles. According to Leggett this is referred to the act utilitarian point-of-view. Leggett (1999) asserts that the act utilitarian approach assesses each action separately and the consequences that occur as a result. Such an assessment would include any "harms" or "benefits" sustained by any individual involved in a case. In implementing such an approach, it seems there are many factors that the Company did not consider. The author explains further that Not included in the previous risk/benefit analysis was the millions of dollars in settlements in unreported cases that never saw the courtroom...the settlement numbers were more on a per-case basis than the average numbers used for lost life per accident. Also, the bad publicity and reputational damage suffered by Ford over the next few years for being the cause of these lawsuits is hard to quantify, but the harm was considerable. From the utilitarian point-of-view, the harms and the benefits are far closer together than Ford determined in its analysis. In addition, if this was figured after-the-fact the harms far outweighed the benefits. This would be due to the cost of having to recall the 1971 to 1976 Pintos after the fact and the extreme bad publicity (much worse than could have been expected) that the Ford Motor Company suffered through for years after all litigation was settled (Leggett, 1999)."

In light of the problem with the placement of the tank and the accidents that occurred as a result, there were lawsuits that were filed against Ford both civil and criminal. The most famous was Grimshaw v. Ford Motor Company. This civil case took place because of an accident that occurred in 1972 and involved Lily Gray who was driving with a thirteen-year-old boy named Ricard Grimshaw when the Pinto they were driving in was hit by another vehicle driving thirty miles per hour (Leggett, 1999). The impact of the accident created a fire in the Pinto which led to the death of Lily Gray and the serious injury of Richard Grimshaw (Leggett, 1999). The article explained that "A judgment was rendered against Ford and the jury awarded the Gray family $560,000 and Matthew Grimshaw $2.5 million in compensatory damages. The surprise came when the jury awarded $125 million in punitive damages as well. This was subsequently reduced to $3.5 million (Leggett, 1999)."

In addition to the aforementioned case, Ford was also the subject of a criminal case after the death of three teenagers. In this case the company was prosecuted for reckless homicide and criminal recklessness (Leggett, 1999). The author explains that in this case the company was being held liable for its refusal to recall the vehicles even thought they were aware that the placement of the fuel tank could result in serious accidents and had already resulted in several fatalities. In the opinion of the prosecutor the company was responsible for criminal recklessness and reckless homicide. The company argued that it used a risk/benefit analysis that was consistent with industry standards. Although this was the case, the company also had an obligation to its customers and to consumer safety as a whole to ensure it did everything possible to ensure that the vehicles that it placed on the road were safe.

Another ethical issue of this particular case is not the fact that the design was defective, many vehicles have defects, the ethical issue is that the company was aware of the defect and they did not stop the manufacturer or recall the vehicle. This had to do with the company's quest and desire to make profits. This desire was so strong that the company was willing to forfeit its reputation and… READ MORE

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