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Ford’s Pinto case problem

“Ethics Case: The Value of Life”

1) No, Ford did not approach the question of redesigning the gas tank to make the car safer versus waiting another year allowing the foreign market to dominate subcompacts. First their goal to maximize profits was their only priority. They did not consider the stakeholders involved and when they did come into consideration, they were analyzed against profits. One has nothing to do with the other. Their goal should not have been a race to make the most affordable subcompact car. Their focus should have been to make the most affordable but safest subcompact. They were aware of the dangers associated with the rush production from the crash tests, whereas, only three cars passed because they had gas tank modifications.

2) Ford had a social and ethical responsibility to their customers to stop production once the danger were apparent and take the necessary measures to eliminate them by redesigning the gas tank. There shouldn’t have been an option to proceed. Their analysis of expected costs and social benefits was a cheap attempt to justify or make (cents) of what they were considering. Knowing very well the outcome would be in their favor. It is never appropriate to knowingly jeopardize people’s lives. That is a criminal act. Their actions were socially irresponsible, ethically, and morally wrong. They did not consider their own reputation nor did they consider that they represented America in the industry. Would you like it if your country were known for cheap parts or deadly parts?

3) It would have made a difference if the 11dollar savings had been passed on to the customers because they would’ve kept their reputation and integrity in tact and possibly gain customers that were not considering the vehicle. A rational customer would not have chosen to save 11dollars to drive a car at risk of dying. It sounds as though they thought they were doing a community service. It is exactly the same as making air bags optional. Seat belts are not optional. They’re crucial to survival in the event of an accident. No one would buy a car at a savings without such safety items. However, these items are visible and known to be present and working properly. It is our assumption as a customer that the operations were tested thoroughly and the car we drive is safe. Ford would have been a very responsible and respected company to acknowledge and admit error in their design.

4) Yes, Ford should have been found guilty in the Ulrich case. They clearly concealed information about the harm that might have resulted from their actions. It is the same as firing the gun the kills someone. Their negligence was the bullet.

5) As a financial manager at Ford, I am obligated to protect, enhance and promote the profits of the organization and the decisions I make will reflect my social responsibility. First I would identify the goals of the organization and the steps taken in the past to maintain and create wealth. I would examine the past profits with the decision to introduce the Pinto to illustrate expected return and or risk in the return. When recognizing the foreign competition as a threat to profits, I will reiterate our customer loyalty, brand status, and integrity, whereas the foreign market has questionable quality and a not so great reputation. To have knowledge of the gas tank dangers and continue production will discredit our standards, jeopardize profits and lead to expensive legal fees. My final decision would be to redesign and we will come back to make financial plans after we’ve figured the costs for redesigning.


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