The Ford Pinto Case Analysis -Business Law

Question

Case Analysis

The Ford Pinto case is a well-known case that is often discussed in the context of business ethics. To summarize, Ford’s design of the Pinto’s fuel tank was defective, causing fires if the Pinto was involved in even minor rear-end collisions. Ford came to learn of the defect, but the company failed to correct it; Ford then predicted, based on a cost-benefit analysis, that it would cost more to repair the defect ($11 per vehicle, or $137 million total) than it would to pay for damages resulting from burn deaths, burn injuries, and burned vehicles ($47.5 million). Consider the Ford Pinto case in light of the who-how

(WH) framework for business ethics.

Would Ford’s decision to forego repairing the defective design comply with these ethical guidelines? If so, why? If not, then what actions should Ford have taken to satisfy them? Explain your reasoning.

The Ford Pinto Case Analysis -Business Law

Owing to the changes in customer needs, tastes, and preferences, businesses and companies are constantly dilemmas when it comes to business operations. As a result, the government has designed and implemented business laws through its agencies in an attempt to protect the business as well as the individual customers. However, for the business law to successfully, effectively and efficiently work, there is the need to incorporate the already designed principles with morals to create a safer operating place for both the business and the stakeholders. However, in the case of the Ford Pinto, the investor the Ford company failed on their part to create a safe product for their customers. According to the case, the ford company decided to match the high competition in the foreign markets by designing a pinto vehicle that was to weigh less than 2000 pounds and cost less than $ 2000 (Kubasek, 2016). Unfortunately, the new ford pinto failed to meet the new the National Highway Traffic Safety Administration (NHTSA) regulations to reduce fires from traffic collisions. According to these regulations, all vehicles produced 1972 would have the ability to withstand a rear-end impact of 20mph without fuel loss. However, this was not the case with the ford pinto, and the company was faced with a dilemma. The management has to decide whether to go on with the production of the vehicle and endanger the lives of the commuters or delay production and redesign the fuel tank (Kubasek, 2016).

The Ford’s decision to go ahead with the production of the Ford Pinto and to put the lives of the people in danger would not go with ethical guidelines. Ethical guidelines often emphasize on the correct rules of conduct necessary when carrying out research. The company had a moral responsibility of protecting the lives of the people regardless of the amount of cash and resources used in making the car safer for the people (Kubasek, 2016). Given the reputation and the size of the company, the company officials would have delayed the production of the vehicle as stated in the timetable, redesign the fuel tank and any other necessary defects to ensure that they meet the needs and demands of their customers without putting their lives in danger. In this case, both the customers and the business would be affected in the sense that the more customers would lose their lives or get injured while the reputation and PR of the company would be tainted. Ford critics believe that more than 500 people lost their lives as a result of a collision even at a low speed when riding on their Ford Pinto despite the company insisting that only 23 people lost their lives (Kubasek, 2016). Further research shows that there were European and Japanese models in the country with similar design to that of pinto regarding price and weight ranges but with safer tank position. Therefore, Ford’s irresponsible decision significantly affected their reputation and image among the people. Given the importance of the consumers to the company, the company should have put their safety first rather than paying much attention to the benefits realized from this project. There was an ethical failure on the part of the company.

References

Kubasek, N. B. (2016). Dynamic business law: The essentials (3rd ed.). . New York, NY:: McGraw-Hill Education.

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