What went wrong?
Back in the late 1960s imports of small Japanese cars were beginning to bite quite deeply into sales of American products. Ford's management decided to produce their home grown sub compact car, with the specifications to weigh no more than 2000 lbs and cost no more than $2000.
A rigid determination to stick to these limits gave their subsequent product, the Pinto, an awful reputation for incinerating it's occupants.
The problem with the Pinto was the position of the petrol tank. This was squeezed in between the rear axle and the rear bumper; but it was found early in the car's development that a rear end collision, even at fairly low speeds, could push the tank forward, rupturing the filler pipe and impaling it on one or more protruding bolts. This could cause petrol to leak underneath the car and so the risk of fire was great. What made it worse was the fact that the concertina effect could also jam the doors close, trapping the occupants inside the car.
What should they have done?
There are various ways in which this could be avoided. The tank could have been repositioned but this would have meant a reduction in boot space which was considered to be a major selling point. A plastic shield could have been inserted but no one was terribly sure if it would make much difference. In all, though, it was calculated that the cost of this would be around $11 per car. This money was not spent.
They did nothing at first! Sales were good. The four-cylinder engine was reasonably powerful, the car handled fairly well (apart from having drum brakes) and, most important of all, it was cheap. Build quality however was a problem and bit by bit stories started to filter in about people being burnt to death in their Pintos after other cars had run into the rear of them. Ford's response, initially, was to claim that they were already dead before they were carbonised! They refused to change a thing.
The chickens come home to roost
Things came to a head when uninvestigated journalist claimed (erroneously) at up to 900 people had died as a result of Pinto fires. Ford recalled around one and a half million of them for alterations, but the damage had already been done. A gentleman called Richard Grimshaw, who'd been badly burned after a low speed accident in his Pinto, was awarded the huge sum of $125 million as punitive damages, and shortly afterwards top management personnel at Ford were accused of manslaughter.
Eventually the Grimshaw award was reduced to $3.5 million on appeal and the company was acquitted of manslaughter but the reputation of putting money before lives persisted for many years to come.
The end result
It didn't seem to make much difference to Pintos sales however! Eventually about 2.2 million Pintos were sold; it has been estimated since then that the number of people who actually died as a result of fires was anywhere between 27 and 200 unfortunates, depending on whose figures you accepted. Compare to the standards of the day, these were not terribly excessive. Perhaps the reputation that Pinto had as a passenger incinerator was a little unfair?