Monday, September 26, 2011

Ethical Dilemmas of the Auto Industry

Every industry has seen its scandals, and with those scandals comes an obligation for companies to do what is ethical. Many times, companies fall down on this in order to salvage their public image and bottom line. The auto industry is no stranger to ethical dilemmas that have plagued America's corporate landscape. 


One ethical dilemma that faces car makers every day is safety versus cost. Auto companies are always developing newer cars, which raises an important question: in designing a new car, what will the balance between safety and cost be? Certainly, there is a demand for inexpensive cars in America and around the world. But there's also an increasing demand for safe cars. A car cannot be one hundred percent safe if cost-cutting measures in its design and production are taken. Auto makers have an obligation to find the perfect balance between low-cost and safe in order to protect lives.


Another dilemma facing the auto industry is that of outsourcing the production of certain components. Toyota faced whirling backlash in 2010 for its recall of over 2.3 million cars to fix faulty gas pedals that were reportedly causing rapid and unexpected acceleration. Looking at the incident today, Toyota made a bad, perhaps unethical decision to outsource the production of the gas pedals. Had Toyota known at any time during its relationship with CTS, the producer of the pedals, that shortcuts were taken in order to meet a certain price or quantity they set, then Toyota undoubtedly made an unethical decision. Auto makers sometimes take risks that could result in ethical dilemmas when outsourcing production of certain components for their cars. 


Sources
(1) http://www.usatoday.com/money/autos/2009-05-19-auto-safety-small-cars_N.htm
(2) http://www.thetruthaboutcars.com/2010/02/why-toyota-must-replace-flawed-cts-gas-pedal-with-superior-denso-pedal/
(Image) http://www.fortworthinjuryattorneyblog.com/toyota_recall_090930_mn.jpg







6 comments:

Collin I really liked the point you made about where the balance should be between safety and cost. All auto companies are striving for the perfect low cost vehicle that is attractive for consumers in both price and quality. Of course there are safety regulations that these cars must pass but I feel like there should come a time when safety is truly the number one priority of the car models, just like the companies proclaim it is in their commercials and other advertisements. Toyota suffered first hand from an ethical dilemma that may or may not have been easily averted. What consumers are then looking at is the manner that Toyota handled this problem and what they were going to do about it in the future to make sure it never happens again. It is truly up to the consumer as an individual to judge the companies in their ethical dilemmas.

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About Blog For more than 20 years AM has built a reputation for being the prime source of news, insight and best practice information for senior executives in the UK automotive retail sector. AM-online | Automotive Management | Automotive Industry News. https://www.feedspot.com/?followfeedid=4762066

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