Pinto/Ford the Ford Pinto: Case Business Plan

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Because it was deemed to cost too much, relative to the target price of the car, Iacocca negated the proposed mechanical reform. "Safety doesn't sell," was his motto. The Pinto was deemed acceptable for the roads because it was a 1971 model and new National Highway Traffic Safety Administration (NHTSA) regulations regarding vehicle safety that would have prevented the release of the Pinto were not passed until 1977.

The 'pros,' however, of avoiding lawsuits seem obvious in retrospect, but within the hothouse managerial atmosphere at Ford, the focus on increasing sales and the bottom line was nearly obsessive, as was meeting set benchmarks.

Feasibility of alternatives

What grabbed the public's attention about the Pinto, in addition to Ford's rigid actuarial calculations of how many lawsuits were likely to ensue per customer death, was the fact that the safety mechanism was so inexpensive and easy for Ford to install. The only reason not to include it, from a feasibility perspective, was because of the company's idea that cost and meeting Iacocca's inflexible deadlines were non-negotiable.

Decide on the valid alternative and make recommendations, agenda of corrective actions

Installing the $11 valve upon the Pinto's release would have prevented Ford from losing sales across the board. Ford's feeble protests that companies make cost-benefit analyses all the time regarding customer safety rang hollow, given the horrific nature of the Pinto crashes and the carnage (third-degree burns all over a young boy's body; the deaths of young girls) that subsequently ensued. The argument that actuarial predictions suggested that 'only 180' lives would be saved that persuaded government regulators to allow the Pinto to be released rang hollow in the minds of the public, which was emotionally devastated with the anecdotal examples of the dangers of driving a Pinto.

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What specific functions and activities must be performed to solve the problems?

Eventually, Ford was forced to order the recall of all 1.5 million Pintos built between 1970 and 1976. To prevent fiascos like the Pinto, Ford executives would have had to have included an analysis of how perception could affect sales. Even if safety did not 'sell' in the sense that consumers would buy a vehicle simply because it was safe, which did not make the reverse true, that consumers would buy a vehicle that was demonstrably unsafe.

Are recommendations workable and affordable?

Tragically, the modifications to the Pinto that could have saved many lives were both workable and affordable. The mechanism to prevent the exploding gas tank would have only cost $11, and would have resulted in a delay of the car's release that would have been far less cumbersome for Ford than the recall, the time and effort put into court cases, and the need to fight the negative publicity against the company in the media. Ford's reputation as a company that cared about its drivers was damaged for many years.

Additionally, Ford knew that it would eventually have to adopt the required standard, due to pending changes in the law. After 1977, all Pintos had to have a rupture-proof fuel tank design. Ford's decision was clearly taken as part of a marketing ploy to stress the cheapness of the Pinto,….....

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