Ford Pinto Essay

1100 words - 5 pages

The Ford Pinto Case
In the late 1960’s Ford Motor Company wanted to produce a small model car to compete with small Japanese and German imports like Volkswagen, Datsun and Toyota (Danley). In 1969 Ford’s Board approved the plan to produce the Pinto. The CEO, Lee Iacocca, wanted a car that was low weight, under 2,000 pounds, and low cost, under $2,000. Lee “Iaccoca imposed the 2000/2000 rule, i.e., the Pinto could weigh no more than 2000 pounds and cost no more than $2000” (Danley). The engineers had about two years to design and manufacture a product. The 1971 Pinto went into production in 1970. The quick turnaround of the Ford Pinto was huge as the normal time frame to bring a new ...view middle of the document...

During the design phase, Ford decided to place the tank behind the axle instead of above it (which was common for cars of that size at the time) because placing the gas tank above the axle would mean less trunk space. Placing the tank behind the axle left about nine inches of crush space (Shaw). In addition, the bumper on the back of the Pinto was not very functional in protection from a crash. Meaning that if the Pinto was involved in a rear-end crash; the likelihood of the bumper protecting the gas tank was very minimal. “Several bolts protruded out of the differential housing in a way that threatened the gas tank in the event of a collision” (Shaw). After a study conducted by Ford, the engineers determined that a baffle, or plastic shield, placed between the gas tank and bumper would bring the car’s safety level up to similar standards of cars in its class.
Ford had two options regarding the gas tank issue with the Pinto. Recall the cars and retrofit them with a baffle or leave them as is and deal with potential lawsuits from injuries and deaths, if they occurred. The cost of the baffle was about $11 per vehicle. There was an estimated 12.5 million vehicles to retrofit for a total cost of $137.5 million. If Ford chose not to add the baffle then they would have to consider the value of life, if lawsuits were filed. Ford determined “$200,000 as the value of life and $67,000 as the value of injury avoidance” (Shaw). Considering how many potential accidents that would result in death or injury, Ford figured the total payout to be about $49.5 million. Figures indicated it was cheaper to pay out lawsuits rather than correct the problem with the Pinto. In addition, changing the production line to add the baffle to the car meant a higher priced car, which Lee Iaccoca did not want. The result was leaving the Pinto as it was designed and the company would deal with lawsuits if and when they arose. At the time, Ford did not consider how much negative publicity would come about because of their lack of disregard for the...

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