The Ford Model

When Lee Iacocca put a rush on the development of a new Ford model in 1971, he probably did not intend for the result to prove deadly for a few hundred people, but this is exactly what happened. As Boatright explains in the text, Iacocca was attempting to compete with the Japanese brands that were outperforming Ford Motor. The carmakers felt pressured to produce something quickly, so they allowed the design to go to production, despite testing which proved the car had a dangerous flaw. Because of the fuel tank’s placement, a rear-end collision at anything above twenty miles per hour, could easily, and likely, lead to a puncture in the tank that could result in a sudden fire. A study was conducted, and Ford found that if a specific part were placed between the tank and the bumper, this could help reduce the likelihood of this occurring, but at an estimated eleven dollars for each part, it was determined that it would be more cost-effective to deal with any lawsuits due to accidental deaths (Boatwright 298). In addition to this, as Donald A. Palmer writes in his, “The New Perspective on Organizational Wrongdoing,” it could not be easily predicted when these fires could occur. He explains, “the Pinto fires did not fit recall coordinator schemas...a good number of people were killed or seriously injured before Ford, under pressure from the National Transportation Safety Agency and growing public outrage, removed the car from the market” (Palmer 14). All of Ford's marketing efforts ceased at that point. It is likely that most people will have an opinion on whether or not this action was ethically justifiable, but a utilitarian analysis of the case may help understand exactly why.

At first consideration, there are two major parties directly involved with the issue: the Ford Motor Company and the individuals purchasing the car. To begin with, Ford is a business; if they are not making a profit, they are useless. For their own sake, they must work to make as much profit as possible. If they are not successful, they will have to shut down. With the benefit of hindsight, it is possible to know just how much money Ford lost by eventually issuing the recall on the Ford Pinto. Not only was there the cost of adding the part, but Ford’s reputation suffered and sales delined. As Philip Bromiley and Alfred Marcus explain their 1989 article, “The Deterrent to Dubious Corporate Behavior: Profitability, Probability and Safety Recalls,” Ford, “sold 33,000 fewer Pintos the year following the recall, which amounts to a pre-tax profit loss of thirty-three million” (244). This is not counting incentive bonuses given to salesmen for selling the Pinto and which may raise losses to 150 million dollars.

The Ford Motor Company was not only affected monetarily by their decision to forgo the recall. Once it was discovered that the company knew they were releasing an unsafe vehicle, they were they faced a number of lawsuits. In his 1981 article, “Ethical Responsibilities of Engineers in Large Organizations: The Pinto Case” Richard T. De George recounts a case brought against Ford that would affect them for years to come. In 1978, three young girls died as a result of a rear-end collision in a Pinto. A lawsuit followed. De George explains “the State prosecutor charged Ford with three...counts of reckless homicide, a criminal offense, under a 1977 Indiana law that made it possible to bring such criminal charges against a corporation. The penalty, if found guilty, was a maximum fine of $10,000 for each count, for a total of $30,000” (De George 1). Ford Motor was the first corporation charged with homicide, a conviction they will carry forever. An additional consequence is a precedent that was set by Ford’s conviction, which can allow for other corporations to be more easily convicted of similar charges.

The second party directed affected by the Ford Motor Company’s decision to ignore thepotential safety hazard in the Pinto’s design is the group of individuals who purchased the car. The most drastic effect would be death resulting from a car accident, and in the years after the car’s production, this was the result for many individuals. In fact, in his 1977 Mother Jones article, “Pinto Madness,” Mark Dowie brought to light just how dangerous the automobile was. He argues that “by conservative estimates, Pinto crashes have caused 500 burn deaths to people who would not have been seriously injured if the car had not burst into flames. The figure could be as high as 900...” This is a huge number of deaths, much higher than what Ford estimated in its cost-benefit analysis. It is possible that if Ford had a more accurate estimate of just how many people would have suffered from the production fault, they may have operated differently, but again, it is just with the benefit of hindsight that this information is even available.

While death is definitely the most drastic effect suffered by the purchasers of the Ford Pinto, it is not the only one. Not every individual involved in a Ford Pinto accident died. The medical costs and loss of wages suffered by individuals during their recovery would likely be repaid by the suits against Ford Motor Company, but these hardships still take a toll. There is also no monetary cure for the psychological and emotional effects of being involved in a fiery accident. In addition, purchasing a new car is a relatively simple hassle, considering, but it is still an effect that must be considered nonetheless.

It is easy to see the effects on the Ford Motor Company and the people who bought the Ford Pinto, but upon further examination, they are not the only parties affected. In the 1970s, Ford Motor was a large company, with many employees. Even if the company was not shut down totally, a loss of profit could have resulted in a loss of jobs. Employees of Ford Motor, in this way, could have been affected if Ford Motor had decided not to continue production of the Ford Pinto. Although the eleven-dollar cost to add the additional part to the car seems a negligible number, when multiplied across the entire production of the Ford Pinto line that is nearly twenty-one million dollars saved by not adding a single piece to a car that would only prevent something that had the potential to occur (Boatright 299). These twenty-one million dollars would have needed to come from somewhere, and it is possible those who work for Ford Motor would have been affected.

Overall, it is easy to weigh the good against the bad in the Ford Pinto case. While the Ford Motor Company could not have known exactly how many people would be affected by the Pinto’s faulty design, they certainly knew the possibility was there, and—since car accidents are a common occurrence—likely. They may have saved themselves some money in the first place, but in the long run, the cost of their indiscretion totaled many millions of dollars. In addition, their reputation was sullied and they were tied up in legal battles for many years following. The individuals who were affected by the Pinto’s design suffered many different consequences, the most significant of which is death. Not only that, but employees of Ford Motor were affected as well as family members of the individuals who died due to the car’s faulty design. In contrast, it is nearly impossible to think of effects and consequences that could be considered good results from Ford Motor Company’s decision—one possible good outcome is the fact that other corporations can now be more easily charged with homicide in cases similar to the Ford Pinto case, but this is not nearly “good” enough to justify the actions of the Ford Motor Company. Considering the parties affected the ways in which they were affected, and the final consequences— good and bad—make it very clear that, at least according to a utilitarian analysis, Ford Motor Company behaved in a way that was not ethically justifiable.

Works Cited

Boatright, John Raymond. Ethics and the conduct of business. 4th ed. Upper Saddle River, N.J.: Prentice Hall, 2003. Print.

De George, Richard. "Ethical Responsibilities of Engineers in Large Organizations: The Pinto Case." Business & Professional Ethics Journal 1.1 (1981): 1-14. JSTOR. Web. 3 Feb. 2014.

Dowie, Mark. "Pinto Madness." Mother Jones Sep. - Oct. 1977: n. pag. Mother Jones. Web. 3 Feb. 2014.

Marcus, Alfred. "The Deterrent To Dubious Corporate Behavior: Profitability, Probability And Safety Recalls." Strategic Management Journal 10.3 (1989): 233-250. Print.

Palmer, Donald. "The New Perspective on Organizational Wrongdoing." California Management Review 56.1 (2013): 5-23. JSTOR. Web. 3 Feb. 2014.