Did ford cost-bene?t analysis validly apply this theory

Reference no: EM131003073

In the 1970s the Ford Motor Company sold its sub- compact Pinto model with known design defects. In particular, the gas tank's design and location led to rupture, leaks, and explosion in low-speed rear- impact collisions. Fifty-nine people burned to death in Pinto accidents. Ford had conducted a cost-bene?t analysis weighing the cost of ?xing the defects ($11 per vehicle) versus their potential liability for law- suits on behalf of accident victims, where Ford placed the value of a human life at $200,000. Ford eventually recalled 1.4 million Pintos to ?x the gas tank problem at a total cost of $30 to $40 million. In addition the company ultimately paid out millions more in liability settlements and incurred substantial damage to its reputation.

(a) Critique Ford's actions from the perspective of the NSPE Code of Ethics.

(b) One well-known ethical theory, utilitarianism, suggests that an act is ethically justi?ed if it results in the "greatest good for the greatest number" when all relevant stakeholders are considered. Did Ford's cost-bene?t analysis validly apply this theory?

Reference no: EM131003073

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