The Ford Pinto Case Analysis

Adam Smith used the metaphor of the invisible hand to refer to the guidance and benefit society receives when individuals act in their own self-interest when trying to make money. According to Smith, when consumers are left to freely choose what they want to buy, and businesses are left to

There are a few concerns about harmful behavior of the FMC that should be discussed. A behavior is harmful when it wrongfully sets back the interest of others and has a high risk of harm. Obviously, the gravity of harm in this case is very high being that it is life threatening. Once a consumer has purchased the Pinto and drives it off the lot he is at risk to getting rear ended, and burned to death by a car fire or explosion. Since the weight of this harm is very severe, the low probability of the consumer having an accident doesn’t discount Ford’s unethical behavior. Indeed, driving a Ford Pinto would place a consumer’s life at risk. Also at stake are the interests of Pinto passengers and drivers of other vehicles who certainly are not willing to risk their lives so Ford can make an extra buck. Everyone has an interest in not getting injured or killed. Setting back the interest of consumers isn’t the only thing Ford Motor Company was responsible for.

In his Wealth of Nations, Adam Smith celebrated capitalist society. The central thesis of The Wealth of Nations is that capital is best employed for the production and distribution of wealth under conditions of no governmental interference, or laissez-faire, and free trade. In Smith's view, the production and exchange of goods can be stimulated, and a consequent rise in the general standard of living attained, only through the efficient operations of private industrial and commercial entrepreneurs acting with a minimum of regulation and control by governments. To explain this concept of government maintaining a laissez-faire attitude toward commercial endeavors, Smith proclaimed the principle of the "invisible hand": Every individual in pursuing his or her own good is led, as if by an invisible hand, to achieve the best good for all. Therefore any interference with free competition by government is almost certain to be injurious. The division of labor is another crucial component of capitalist society. According to Smith, division of labor benefits society in three ways:

Company in the early 1970s when the company decided not to recall the Pinto despite dangerous

From a utilitarian theory, the Ford Motor Company focus on damage arising from this decision of money and nothing else. Money is seen as value by the Ford Motor Company, so by losing money by law suites and protecting the Ford Motor Company employees outweigh the collateral damage the Ford Pintos line up imposes. Jeremy Bentham brings to light the pleasure and pain aspect of what the decision would bring. In this case the Ford Motor Company expresses that the money saved from the recall brings more pleasure to the most amount of people. The money being saved is obviously from not installing the baffle between the gas tank and rear bumper. The consumer will also save money by the Ford Motor Company not issuing a recall. If the Ford Motor Company issued a recall, then the price of the Ford Pinto would be more than what was stated thus maybe making it not comparable to other cars in its class. You must also consider the pain that this decision creates. Because the Ford Motor Company refused to issue a recall to install the baffle between the gas tank and the bumper, it has created pain and suffering to those who were affected by rear-end collision injuries.

There was strong competition for Ford in the American small-car market from Volkswagen and several Japanese companies in the 1960’s. To fight the competition, Ford rushed its newest car the Pinto into production in much less time than is usually required to develop a car. The regular time to produce an automobile is 43 months but Ford took 25 months only (Satchi, L., 2005). 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

The gas tank was positioned according to industry standard at the time, between the rear bumper and the rear axle, but studs protruding from the rear axle would puncture the gas tank. Upon impact, the fuel filler pipe would break, resulting in spilled gasoline. The Pinto basically turned into a death trap. Ford crash tested a total of eleven automobiles and eight resulted in potentially catastrophic situations. The only three that survived had their gas tanks modified prior to testing. (2)

The Cost benefit analysis is a financial model where companies or government establishments implement on their decision making. The model simply evaluates costs and benefits of a certain decision which enables the organization to choose the “right” option. (O’Farrell, R.,n.d.) The beauty of the CBA model lies in its simplicity, the chosen option is easily justifiable, when the costs are higher than the benefits then there is no compelling reason to make that decision. (O’Farrell, R. ,n.d.) In addition to its simplicity, the model is applicable to various types of decisions, it enable

The prototype undergoes a range of testing to ensure that the vehicle meets or exceeds all required motor safety guidelines prior to its final market release. The Pinto was never subjected to rear-end impact testing until after the vehicle was already in production. Rear impact testing concluded that there could be potential problems with the placement of the fuel tank. If the Pinto was “hit from the rear at a speed above 20 miles per hour, it would be punctured by a bolt from the bumper and could possibly burst into flame[s]” (DeGeorge 298). As a result of the findings, Ford determined that a baffle costing less than $11 would reduce the possibility of rear impact fuel tank rupture and subsequent fire (DeGeorge 298).

The Ford Motor Company faced a number of ethical dilemmas during the production of the Ford Pinto. There was a time when the “made in Japan” label brought a predictable smirk of superiority to the face of most Americans. Most Japanese products were not only low in quality but also in price. By the late 1960’s, an invasion of foreign-made goods had distressed the U.S industry. Detroit was beginning to panic because the Japanese and the German’s were starting to devour more of the subcompact auto market. Ford Motor Company chose to meet what they considered “a threat” from abroad, head on. The executives of Ford decided to produce the Pinto in 1968. The Pinto weighing no more than 2,000 pounds and costing no more than $2,000, was known inside

The Elkhart County Grand Jury took up the matter and filed a charge of criminal homicide against Ford, the Automobile American Corporation that designed the Pinto car models. According to Elkhart County Grand prosecutor, Michael A. Cosentino, Ford was guilty of reckless homicide, because the company committed a conscious, plain, and unjustifiable neglect of harm that positioned the gas tank in the rear end of the car without proven protection. Besides, Ford engaged in negligence and substantial deviation from the acceptable standards of conduct. The major focus of the case entailed the expanding and assessment of acceptable standards the company violated in the process of manufacture of Pinto cars.

In August of 1978 three teenage girls were driving a Ford Pinto and were struck from behind. The three girls died because the Ford Pinto’s fuel tank ruptured from the collision and burst into flames. There was a big debate about the safety of the Ford Pinto to its proneness to its fuel tank catching on fire in low-speed rear-end

Their vehicles began to portray their defects on crashes leading to the deaths of many people. Therefore, the people affected, the family members of the deceased, and states began to present lawsuits to the Ford Motor Company

Personal evaluation of this case would take into consideration the fact; one engineer did offer a document indicating and estimate for the cost of value refitting which would prevent the Ford Pinto from bursting into flames should a rear end collision occur. A simple, $1, plastic gadget weighing one pound fitted over the gas tank bolts would have prevented the tank from being punctured. Conclusion was that "it was more economical to let people die and settle the suits afterward" (Newton and Ford, 2008). Put simply, the Ford corporate heads believed no project was worth manufacturing if the cost-benefit indicated a greater cost than the benefit. Further evaluation of the analysis indicated if the

I think Pinto case raised some serious issue of abusing human rights and not behaving ethically in the world of business. Any business/service should never ever put a value on human life and not take consideration of a known deadly danger. Ford had an option as well as the solution to design the car in a way that prevented cars from exploding; however they refused to implement it.   They thought that it was cost effective not to fix dangerous condition than to spend the money to save people in spite of the fact that the only added cost was $ 11 per vehicle.