The Ford Pinto Project
The Ford Motor Company has been the leading car company for many decades. In the late 1960’s early 1970’s the company was losing the battle with Japanese with the small efficient cars. Lee Iacocca, Chief Executive Officer the Ford Motor Company wanted a car that will be competitive to these Japanese compact cars. With this intention in mind, the company wanted to manufacture a sub-compact vehicle that weighs less than 2,000 pounds and costs under $2,000. The result is the Ford Pinto. The Ford Pinto was one of the earlier sub-compact cars of the 1970’s. The Pinto was a catalyst in the revitalization of domestic compact cars at this time when Japanese imports were front rumors. Sure the car was simply affordable but had one flaw that would tarnish its reputation and the company’s. The Ford Pinto had fire hazard issues resulting from the placement and construction of the gas tank. When a Pinto is rear-ended the car would burst into flames resulting in an explosion. The company realized this concern during production. Because Iacocca wanted a fast sell of these cars records indicated that there was not a rear end collision test conducted until months after it was already in the market. Management did a cost analysis and determined that the cost of fixing the problem versus any lawsuits; it would be cheaper to pay for the lawsuits that would arise. Given the case study a quick review, money, objective, time, and ambition are the key factors surrounding the Ford Pinto case. Money is the number one key factor because starting from the idea of this product line; the company prepared a cost analysis/profit of producing the car. The company has a budget to work with that will enable them to build it. The other concern is the manufacturer’s suggested retail price of not a cent more than $2,000. Even after the Pinto was discontinued back in 1978 and the cars were auctioned off, Ford still made the profit that they expected to make because the cars were auctioned off at $1,800 each minus the damage cost. The second factor is the objective of the idea. As a visionary, Lee Iacocca wanted Ford to be the pioneer in American compact cars. The objective of the game is for Ford Motor Company to gain a competitive advantage as an American car company to produce a vehicle comparable to the Japanese compact car and to sell it at a decent affordable price. As an officer of the company, Iacocca had the right idea in mind but did not see the consequences after the fact when he ordered a rush to build these cars. The third factor is time. Iacocca thought that time is of the essence. He suggested the company build the Ford Pinto in 25 months instead of the average of 45 months to build a decent car. They wanted the line produced so fast as to gain the edge of profit making in America. Employees in the assembly line knew that there is not ample time to get the car ready. They did not conduct safety test resulting in undermining employee’s values and beliefs as well as destroying what the company stands for. Ambition is the last factor. Of course every employee of a company has ambition and Lee Iacocca landed him the Chief Executive Officer of Ford. Because the Pinto was produced faster than its normal building time, proper protocols were ignored. The mission, values, and guiding principles of the company were compromised and mistrust is in its place. Today in Ford’s society their mission statement indicates that Ford Motor Company a global chief in automotive and automotive-related goods and services as well as in newer industries such as aerospace, communications, and economic services. Their mission is to develop constantly the goods and services to meet consumers’ requests, allowing them to grow as a company and to provide a reasonable return for the stockholders and owners of their business. Ford plans to accomplish their mission that is as important as the mission itself. Elemental to triumph for...
Cited: Ford Settles Lawsuit Over Accident Victim for $1.8 Million Total; Amal Nag; Wall Street Journal (Eastern Edition), New York, NY, March 19, 1984
DeGeorge, R.T. (2010). Business Ethics (7th ed.), Upper Saddle River, N.J.: Prentice Hall
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