Ford Pinto Case Study

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Ford Pinto Case Study MGT 216 11/17/2011 Vivek Singhal Many in the corporate world are willing to do whatever it takes to compete in the global market. However, ethical business practices should always be a top priority. No company understands this better than Ford and the mistakes the company made with the release of the Ford Pinto. In 1969, Lee Iacocca, president of Ford Motor Company, convinced CEO Henry Ford II to be a competitor in the small car market, thus launching the birth of the Ford Pinto. Typically it took automobile makers approximately 3.5 years to release an automobile to the public. However, Lee Iacocca felt that this timeframe was unacceptable and Ford could have the Pinto ready in two years. During the crash test phase it was recognized that the fuel tank caught on fire if rear-ended. However, because production procedures were overlapping this discovery would cost Ford too much money to stop production and redesign a safer model. Ford proceeded with the current model, and the Pinto was debut in 1971 (Trevino, 2006, p.116). Evidence of structural defects for the Pinto surfaced. Because the car passed the tests established by the Federal Motor Vehicle Safety Standard 301, and none of the incident reports fell within Ford’s scripted criteria, the Pinto was not recalled. Dennis Gioria was the field recall coordinator at Ford during this time. Gioria had the opportunity to view firsthand a burned Pinto. This image made him realize the severity of the issue, and he brought the case to the members of the recall unit. Again, the Pinto did not fall into the “scripted” criteria so recall members, including Gioria, opted not to issue the recall. Ford knew during the testing phase the fuel tank design was faulty. They tested and discovered possible solutions for the problem. Placing a plastic baffle

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