3/25/10

Ford Pinto - History lesson. Kaboom.

The Ford Pinto wasn't a bad looking car, in my opinion. Sure, the wagon shown in this ad is kind of lame, but the front end is pretty cool looking. In normal hatchback form, the Pinto is a car I'd own... with better wheels and a little more power under the hood, but that's as may be. The fun part about Pintos is that they were kind of "explodey"

You can read full accounts of the Pinto's story here and here. Here's my attempt at the Cliff's Notes version of the story.

In a low speed rear-end collision, Pinto gas tanks would reliably rupture and explode. Also, the doors tended to jam shut in such collisions, trapping the passengers inside, burning to death. Funny coincidence.

Ford engineers recommended that the design be changed to prevent this, at a cost of $11 per vehicle, by repositioning the gas tank. A cost-benefit analysis was done, and president Lee Iacocca determined that, what with court costs and law suits and re-engineering the car, it was cheaper to let 180 customers die. Not kidding.

This table is from one of the links shown above:


BENEFITS 
Savings: 180 burn deaths, 180 serious burn injuries, 2,100 burned vehicles.  Unit Cost: $200,000 per death, $67,000 per injury, $700 per vehicle.
Total Benefit: 180 X ($200,000) + 180 X ($67,000) + $2,100 X ($700)  = $49.5 million.
COSTS 
Sales: 11 million cars, 1.5 million light trucks. 
Unit Cost: $11 per car, $11 per truck. 
Total Cost: 11,000,000 X ($11) + 1,500,000 X ($11) = $137 million. 

And then, a funny thing happened. Goodyear had developed a rubber bladder that, when placed inside the fuel tank, would prevent fuel from leaking. Tests showed it worked every time. This bladder would have cost $5.08 per vehicle, cutting the cost of saving 180 lives roughly in half. The test document was covered up by Ford, but became part of the inevitable lawsuit that cost Ford more than three times what they could have spent to do the right thing and avoid the whole mess.


In a later lawsuit in 1979, Ford Motor Company became the first company ever to be indicted on charges of criminal homicide. Ford was acquitted. Shucks.

To add insult to injury, Iacocca was hired by Chrysler, where he oversaw the introduction of the K-Car. This is a move widely regarded as The Worst Thing Ever Done, until Pontiac built the Aztek, that is.


1 comments:

israelkwalker said...

Actually, describing the K-car almost violates language. It's not that it was good or bad. It was fantastically adequate. If you could imagine a scale of adequacy that went from 1 to 10, with five being average adequacy and 10 being a really great degree of adequacy, the K-car was an 11.

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