Case Analysis
The Ford Pinto example is a well-known case that is often discussed in the context of business ethics. To summarize, Ford’s design of the Pinto’s fuel tank was defective, causing fires if the Pinto was involved in even minor rear-end collisions. Ford came to learn of the defect, but the company failed to correct it; Ford then predicted, based on a cost-benefit analysis, that it would cost more to repair the defect ($11 per vehicle, or $137 million total) than it would to pay for damages resulting from burn deaths, burn injuries, and burned vehicles ($47.5 million). Consider the Ford Pinto case in light of the who-how (WH) framework for business ethics.
Would Ford’s decision to forego repairing the defective design comply with these ethical guidelines? If so, why? If not, then what actions should Ford have taken to satisfy them? Explain your reasoning. Explain the need for promoting business social responibility.
Your response to this question must be at least two pages in length. One source is required. Include an introduction in your paper. Adhere to APA Style when creating citations and references for this assignment. APA formatting, however, is not necessary.
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Assignment
Introduction
In the case presented, it is evident that Ford Motor Company was aware of the problem, but still chose not to recall Ford Pinto at the cost of $137 million. The company also had an option of paying damages in terms of burned vehicles, injuries or death caused by defective fuel tanks at a cost of $47 million(Ford Motor, 2018). If Ford’s decision was to analyzed from the perspective of ethical lens, it was prudent for the company to prioritize the safety of the vehicle owners and recall all the defective vehicles since the injuries and death cannot be equated to not good or right. However, if the ethical lens was to be used based on the monetary gain, the Ford Motor Company was right not recalling the defective vehicles due to high cost involved. How does then the Ford Motor Company apply the ethical lens.
The (WH) framework for business ethics states that “a set of ethical guidelines that urges us to consider whom an action affects, the purpose of the action, and how we view its morality”. Therefore, when determining who action affects, it is imperative for the business to put into consideration all the stakeholders(Kubasek, et al., 2016). It is important to note that in Ford’s case, it is not only about the victims who could be harmed by the defective vehicles, it also affects the community where the company operates, the management, the shareholders, and the employees who works on vehicles. For instance, one car fire is not likely to impact the larger community, but it will create negative publicity which could drive away the buyers and negatively impact the stock of the company.Similarly, recalling all the defective vehicles will attract unnecessary attention to the company, which may lead to negative publicity and subsequent reduction in car sales. It also means that the company will incur extra cost when fixing the defective………………………………………………………………………………………………
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