Manufacturer’s Theories
Manufacturer’s Theories
Initially, the majority of the corporate organization aimed to maximize the profit without considering their safety and responsibilities to the consumers. The burden of the defective product was solely left to retailers who sold the defective products to consumers for many years. Due to increased cases of many consumers reporting injuries from the defective product and constant loss of the small-scale retailers due to substandard products, manufacturers’ they were involved in the issues. The burden of compensating and ensuring the consumer’s safety from using various products became an obligation to the manufacturers. There are three theories that explain obligation and responsibilities of the manufacturers so as to ensure the safety of the consumers. The theories are the contractual theory, the due care theory, and social cost view. The three theories will be used to analyze a case study of Firestone and Ford concerning consumers’ safety and responsibility.
In 26th February 2004, the Firestone Company recalled almost five hundred thousand Steeltex tires from the market. The tires were closely linked to frequent crashes of the sport utility vehicles. The crashes claimed lives of five people. The tires were specifically manufactured for use on Ford Excursions for three consecutive years that is from 2001 to 2003. The Firestone Company had also recalled more that seventeen million tires initially due to more than two hundred people reported dead and many injured from accident linked with the use of the same varieties of tires in different occasions. As a result of the recalls, the Firestone Company reported a loss of $1.5 billion.
Consumers in many free markets they usually have general assumption that they are free from the danger from the use of different products. According to the contractual theory, it is the duty of the manufacturers to ensure safety, standards and respect rights of the consumers of the specific product they introduce in the market. Ford as the manufacturer of the sports utility vehicle it was responsible for the accident that resulted from its vehicle. Although Ford Executioners met the quality of sports utility vehicle thus preferred by the consumer in the market, it failed in designing the vehicle, whereby it specifies the use of specific type of tires from only a specific company. To handle the situation, Ford could have provided an option of tires from other companies to be used by Ford Executioners so as to give consumers their sovereign of participating in a free market.
In a market, consumers are willing to pay for the product that the sellers have an enticement to meet their wishes. If consumers are no happy with the goods provided by a specific manufacturer the company, in turn, will incur a loss. So as to earn profit manufacturer tend to ensure that what they provide in the market is safe to the consumer. The main reason that made the Firestone Company recall millions of tires from the market is to continue booming in the market and meet the customer’s demand. As per due care theory, it was the responsibility of the Firestone to ensure that the consumers are not harmed by its product since it has more information concerning the product than the consumer. After discovering the risk exposed to the consumer, the Firestone Company recalled most of its tires so as to minimize the risk the lives of its consumers. The Firestone Company did not compensate the injuries and the deaths that resulted from the use of its substandard tires. According to the cost and view the company should pay and compensate all the injury that results from counterfeit products irrespective of the manufacturing and distribution cost. As per my views, Firestone Company was the one responsible for the deaths that occurred. It is because the company was supposed to pre-test its products for quality and reliability before releasing them to the market.
