The Business Ethics Blog

For years, the ‘Ford Pinto Case’ was a staple of business ethics classrooms. As readers of a certain age will know, the Ford Pinto was discontinued in the early 1980s, in part due to controversy over safety. The potted version of the case, as studied in hundreds of business ethics classrooms, goes roughly like this: in the late 60’s, Ford decided it needed a small, light, cheap car to compete with Japanese imports. So in the early 70’s, Ford started producing the Pinto. Shortly after, the company started receiving reports of Pintos catching fire after relatively minor rear-end collisions. People died, or were badly burned, and some lawsuits ensued. The problem was traced to a design flaw having to do with the design of the rear bumper and the placement of the gas tank. Engineers concluded that an easy and effective fix would be the addition of a small plastic shield between the gas tank and some protruding bolts that otherwise tended to puncture the tank in the case of collision. The fix would cost $11 per car. But some quick math showed that an $11 fix to about 12 million cars would cost a lot more than what the company was likely to have to pay out in lawsuits to victims and their families. So, they kept making and selling the cars, minus the $11 fix. And the fiery crashes kept happening, until Ford finally canned the Pinto in 1980. (You can find more details here, via Wikipedia: Ford Pinto fires.)

So, that’s the standard version. And I’ve heard it referred to in the hallways of business ethics conferences within the last year. As far as it goes, the case is a great way to generate discussion about the profit motive, about cost-benefit-analysis, and about the ethics of putting a dollar-value on a human life.

Problem is: the ‘standard’ version isn’t entirely true.* First, the Pinto was not unusually fire-prone, when compared to other cars its size at that time (like the VW Beetle). The Pinto got some bad press, but it wasn’t exactly unusual, in terms of safety. And in cases like this, what’s ‘normal’ in the industry matters (though it’s not all that matters). Second, the internal Ford memo that showed the cost-benefit math was directed at regulators, and there’s little evidence that it was even seen by the Ford execs who made the decision to go ahead with production. So while that math was done, it’s not clear that it was acted upon. None of this is to say that Ford was blameless, but those are pretty important details, from the point of view of assigning blame.

Fast-forward roughly four decades, and another manufacturer is in the spotlight. A recent NYT story outlines the case of the Polaris RZR (pronounced “Razor”), a 4-wheeled off-road recreational vehicle that has been at the centre of a number of recent lawsuits. And that story that is at least  superficially similar to the case of the Ford Pinto: there are fiery deaths and injuries, apparently traceable to a clear design flaw, and ignored by the company for years.

A few more points of similarity, and a few differences, between the two cases, based on what the NYT has reported:

Baseline statistics: The NYT reports that “2013 to 2018, Polaris Industries issued RZR recalls 10 times for fire hazards, far more than for any competing product.” In other words, the RZR hazard is not just bad, it’s remarkably bad. This seems to be a difference between the RZR case from the Pinto case.

Design flaw: The NYT reports that the RZR’s new, souped-up engine “has an exhaust pipe that is housed inches behind passengers and too close to key components without adequate ventilation, lawsuits have alleged, citing reviews by mechanical engineers.” And: “On the ProStar [engine], the exhaust header pipe is connected to the front of the engine, behind the seats, before turning 180 degrees and ending at the rear of the vehicle.”

Tradeoffs: In both cases, the question of tradeoffs — potentially deadly ones — are front and centre. In the Pinto case, the tradeoff was supposedly, at least, made by Ford: they decided that keeping the car cheap was better for them, and maybe better for cash-strapped customers, too. In the Polaris RZR case, the tradeoff is perhaps also being made by customers. According to the NYT, the RZR remains popular because, “For many customers, any danger is overshadowed by excitement.”

In both cases, it is tempting to chalk up the death counts to a simple matter of corporate greed: “Hey, the profits are awesome, so let’s keep selling these things, regardless of the risks to consumers!” But in both cases it’s incredibly unlikely that things are as simple as that. Large corporations are complex entities, composed of people clustered into units. Some of those people, and some of those units, will yes likely be driven by greed. Others will be driven by faith in their product, by personal ambition, by professional pride, or by a drive to “hit the numbers” — whether or not hitting those numbers is actually conducive to any particular corporate goal.

* Some of the details are taken from: Matthew T Lee’s and M. David Ermann’s paper,  “Pinto ‘madness’ as a flawed landmark narrative: An organizational and network analysis.” Social Problems 46.1 (1999): 30-47.