Company A designed a subcompact, the model P, which weighed less than 1000kg and sold for less than $2,000. Anxious to compete with foreign-made subcompacts, Company A brought the car into production in slightly more than 2 years (shorter 1 years from usual practices). Given this shorter time frame, styling preceded much of the engineering, thus restricting engineering design more than usual. As a result, it was decided that the best place for the gas tank was between the rear axle and the bumper. The differential housing had exposed bolt heads that could puncture the gas tank if the tank were driven forward against them upon rear impact.

Company A also tested rear impact when rubber bladders were installed in the tank, as well as when the tank was located above rather than behind the rear axle. Both passed the required rear impact tests. Although the federal government was pressing to stiffen regulations on gas tank designs, Company A contended that the model P met all applicable federal safety standards at the time. The Director of Automotive Safety for Company A, issued a study titled Fatalities Associated with Crash Induced Fuel Leakage and Fires. This study claimed that the costs of improving the design ($11 per vehicle) outweighed its social benefits. A memorandum attached to the report described the costs and benefits as follows:

The estimate of the number of deaths, injuries, and damage to vehicle was based on the statistical studies. The $200,000 for the loss of a human life was based government agency study, which estimated social costs of a death.

Discuss the appropriateness of using data such as these in Company As decision regarding whether or not to make a safety improvement in its engineering design. If you believe this is not appropriate, what would you suggest as an alternative? What responsibilities do you think engineers have in situations like this?

(20marks)

Benefits Savings 180 burn deaths, 180 serious burn injuries, 2100 burned vehicles $ 200,000 per death, $67,000 per injury, & $700 Unit Cost per vehicle Total benefits 180 x $200,000 plus 180 x $67,000 plus 2100 x $700 = $49.15 million Costs Sales Unit cost 11 million cars, 1.5 million light trucks $11 per car, 11 per truck 11,000,000 x $11 plus 1,500,000 x $11 = $137 million Total Costs Benefits Savings 180 burn deaths, 180 serious burn injuries, 2100 burned vehicles $ 200,000 per death, $67,000 per injury, & $700 Unit Cost per vehicle Total benefits 180 x $200,000 plus 180 x $67,000 plus 2100 x $700 = $49.15 million Costs Sales Unit cost 11 million cars, 1.5 million light trucks $11 per car, 11 per truck 11,000,000 x $11 plus 1,500,000 x $11 = $137 million Total Costs