Student Case Study: The Ford Pinto Case Case OverviewIn the early 1970s, Ford Motor Company rushed to design and release a small, affordable car called the Ford Pinto to compete with Japanese imports. During crash tests, engineers discovered a serious design flaw: the fuel tank was positioned too close to the rear bumper, making it prone to rupture and explode even in low-speed rear-end collisions.Ford calculated that fixing the problem with a protective shield would cost about $11 per car, amounting to roughly $137 million for all cars. Instead, the company estimated potential lawsuit costs and damages at around $49 million and decided not to fix the cars before release.After many accidents involving fires and fatalities, the case became public. Ford recalled 1.5 million Pintos, and over 100 lawsuits followed. Including recall costs, settlements, and legal fees, the total approximate cost of the Pinto scandal was around $170 million. This case is often cited as a classic example of the consequences of ignoring business ethics.In-Class Group ActivityInstructions:Read the case carefully.Discuss and answer in writing the following questions within your group briefly:Discussion Questions:a) What ethical issues do you see in Ford's decision?b) Who are the stakeholders in this case, and how were they affected?c) Was Ford's cost-benefit analysis a fair way to make a decision? Why or why not?d) If you were on Ford's management team at the time, what would you have recommended?e) How should Ford have acted to show corporate social responsibility (CSR)?f) what can governments do to protect consumers from such hidden unethical practise by businesses?